How to photograph Horsetail Falls:  2010-2011 edition.
Backstory is important.  Let’s begin in the early to mid 70’s, with what may well be the definitive photograph of Horsetail Falls by Galen Rowell.  Entitled “Last light on Horsetail Falls”, it has had a profound affect on photographers the world over.  35 years later, people still brave Yosemite in winter to photograph this luminous spectacle.

Horsetail Falls is often called the “natural firefalls”, which reflects a defunct tradition of the early days of Yosemite valley.  In the late 1800’s, a frustrated innkeeper at Glacier Point kicked a bonfire over the edge of the cliff, sending glowing embers down the granite face.  He’s set up a grand opening party, and nobody came.  The fire he’d built took the brunt of his anger.  People on the valley floor were entranced by the sight of glowing coals falling in slow motion.  A new spectacle was born, and the firefall became an almost nightly occurrence.  It was stopped for good in 1969.  The park supervisor at the time is quoted as saying “If they want Disneyland, let them go to Anaheim!”.  The falls themselves weren’t the problem.  The problem was the destruction caused by hundreds of visitors crowding the meadows to see the firefalls.  
I have firsthand experience of that ecological nightmare.  When I was a small child, my mother brought me to Yosemite to see them.  We stood on Stoneman Meadow, but it was so crowded with cars and campers and trucks and people a stranger offered to pick me up and put me on his shoulders so that I could see.  It made an impression on me.  Stoneman meadow is still recovering from the damage. 
In contrast, Horsetail Falls hosts the natural firefalls.  Situated on the northern side of the valley, and at the extreme eastern end of the El Capitan monolith wall, the falls catch the last rays of the setting sun for only about one month of the year.  At midwinter, the sun sets below the southwestern rim.  As the year progresses, the sun sets a bit further north along the western horizon.  By the end of January, if you are standing at the El Capitan picnic area parking lot, you can see the sun setting in the Gunsight, the V between Cathedral rocks on the eastern side of Bridal Veil Falls.  By the first few days of February, it sets to the right of the lowest Cathedral rock.  Provided the sky is clear, the sunlight illuminates the entire El Capitan North America wall, and if you are in a position east of the falls, it backlights the water, making it glow with amazing colors;  I’ve seen the water brilliant silver, molten gold, and cherry red at different times of the year.  I don’t know what causes the different colors.  I’m not sure if the angle of the sun is responsible, or if air pollution has a part in it.  
If you talk with people who’ve photographed the natural firefalls, each one will have an opinion when the best time is.  Conventional wisdom around the valley seems to be that the third week of February is “best”. If you define “best” as brilliant red, glowing water against an otherwise shadowed wall on either side, they’re probably right.  However, I don’t subscribe to that definition of “best”.  Horsetail Falls  has many photographic moods, and I’ve gotten what I consider very good shots of the falls from the end of January all the way into March.  
The key, I think, is to take the chance and be in place regardless of the weather.  One thing I have noted is that even if the sky is cloudy, very often the clouds are high enough so that the sun slips in underneath to light up that wall.   Where should you be?  That’s a matter of personal preference.  This phenomenon is not like shooting rainbows, where the sun should be directly behind you.  You need to have the falls almost between you and the sun.  You’re looking for an oblique angle.  Geographically speaking, you don’t have much choice.  While you can get a good angle on the south side of the valley, you’ll need a long lens to get detail.  I suspect you could do really well on the south rim, probably from Sentinel Dome, but the need for long glass increases in proportion to the distance between you and the falls.  My personal favorite is the El Capitan picnic area.  You’re close enough to the falls that you won’t need hella-long glass.  The area is reasonably clear of trees, providing a clear shot of the falls.  There’s a bathroom, too!  
What is needed is complex;  there are two conditions that have to be met.  A clear path for the sunlight, and water coming over the edge of the cliff.  Simple?  Not really.  Weather conditions have to be right for several days prior.  The water comes strictly from snowmelt.  Horsetail is an ephemeral fall.  It starts and stops unpredictably.  There has to be snow above El Capitan, and then there has to be a few days of sunlight and warm weather up there to melt it enough to flow down to the edge.  
Additionally, weather happens fitfully here in the valley.  NOAA, those fine folks who try so hard to predict weather, just don’t have a very good track record.  I’ve noticed this year that clouds have been arriving from the west in the late afternoon.  This isn’t always bad, mind you.  They’ve been high enough that the sunlight shines under them at the last minute to illuminate the wall.  This is a good thing, actually.  The upper cloud layer often takes on wonderful color, adding interest to your composition.  You’re looking up at the falls, and it’s easy to include some sky in the shot.  Even if there is no water, the light is often spectacular enough to make it worth going anyway.  
Of course, the time of year brings its own problems to the efforts of those who want to capture the firefalls.  Remember, it’s February, winter in the northern hemisphere.  You’re going to be in the mountains, as well, and that means several things besides being colder than what you may be used to.  Me, I’m all about creature comforts.  I will be carrying in a small folding chair and a cushion, my JetBoil stove, some tea and cookies, and hand and footwarmers.  I may even pack in some charcoal and a coffee pot.  Hey, it’s a picnic area, there are standing grills!  It’d be nice to have some warmth, and fresh coffee.  I’ll be dressed warm too.  My waterproof and insulated boots, rated to -20.  A down jacket, and merino wool longjohns.  Thin merino wool gloves, flexible enough to operate my shutter release.  A wool hat, made for me by a fellow resident.  A stainless steel canteen, 1 liter, tucked into an inside pocket and full of hot sweet tea.  A headlamp, with fresh batteries. A freshly formated memory card, fully charged batteries for my camera.  Oh, yes, my tripod, and my camera.  
I hope that this article helps you to take better pictures.