Core Location: Techniques
There are two types of strokes for fingerpicking, free and rest.
Free stroke is plucking upward into the palm. The fingertip misses the string above the plucked string.
A general training rule for free stroke is that the knuckle of the finger - that is picking the string - is directly above the string being picked. If we drew a line straight down from the bottom of the knuckle, it would lead directly to the string.
If this wasn't the case, and we were as far away as a rest stroke position, we would have to use the upper joints to pick a free stroke.
Once we locate and train from this position - this point of reference - we can fall into our pocket, wherever that may be [if we drew a line, it might not line up perfectly, but we are producing sweet tone with good mechanics].
Rest stroke is plucking so the fingertip lands on the string above the string being plucked. To achieve this, we have to move our hand/arm so that the motor knuckle is '2 or 3' strings above the string being picked. Rest stroke is naturally a stronger (louder) sound since we are directing the sound downward, into the bridge.
Free stroke is naturally less strong (though we can pick harder), since we are picking across the string, less sound goes into the bridge (than rest stroke).
We can play scales free or rest (this is a choice we make before starting a scale). For arpeggios, we can use thumb rest strokes, but the upper fingers have to be free. This is the desired sound of arpeggios anyhow...letting everything ring. On this site, we will train arpeggios all free stroke. Rest strokes are used for accented tones, typically the melody in the highest voices.
Each of us decides how and when to use these strokes. For now, work on the motion, which translates into using the main knuckle driver, and hand location.
The core idea here is that we pluck the same, and depending on our hand shape and location, the fingertip will end up either in the palm (free) or on the string above (rest). This core concept is similar to using a pick..."this is how I pick, what I pick is based on where my hand is located".