Inserting image into IPython notebook markdown

Question

I am starting to depend heavily on the IPython notebook app to develop and document algorithms. It is awesome; but there is something that seems like it should be possible,

Answer 1

minrk's answer is right.

However, I found that the images appeared broken in Print View (on my Windows machine running the Anaconda distribution of IPython version 0.13.2 in a Chrome browser)

The workaround for this was to use instead.

This made the image appear correctly in both Print View and the normal iPython editing view.

UPDATE: as of my upgrade to iPython v1.1.0 there is no more need for this workaround since the print view no longer exists. In fact, you must avoid this workaround since it prevents the nbconvert tool from finding the files.