updated readme

Author: emocharnik

README.md

@@ -21,10 +21,34 @@ Please Note: This extension is currently in its early stages of development. Whi
 | Plan/Apply Output    | Read the output from Terraform plan and apply operations directly within VS Code.                            |
 | Scalr UI Integration | Convenient links provide quick navigation to the corresponding sections of the Scalr web UI.                 |
 
-## HTTP PROXY
+### Configuring an HTTP Proxy
 
-If the [proxy server](https://code.visualstudio.com/docs/setup/network#_proxy-server-support) is don't used. The proxy for https://scalr.io/ could be configured on vscode by http.proxy and http.proxyAuthorization variables (Settings > User > Applications > Poxy)
-or by HTTP_PROXY, HTTPS_PROXY environment variables.
+If your environment requires using an HTTP proxy to connect to external services, you can configure the VS Code extension to use a proxy by following these steps:
+
+1. **Open Settings**:  
+   - Go to the **Settings** tab in VS Code.  
+   - Alternatively, you can open the command palette (`Ctrl+Shift+P` or `Cmd+Shift+P` on macOS) and search for `Preferences: Open Settings (UI)`.
+
+2. **Search for Proxy Settings**:  
+   - In the Settings search bar, type `proxy`.
+
+3. **Configure Proxy**:  
+   - **HTTP Proxy**: Enter your HTTP proxy URL under `Proxy > HTTP: Proxy`.
+   - **HTTPS Proxy**: If your proxy also handles HTTPS traffic, enter it under `Proxy > HTTPS: Proxy`.
+   - **Proxy Strict SSL**: Toggle `Proxy > Strict SSL` if your proxy uses a self-signed certificate.
+
+4. **Configure the Extension**:  
+   - If the extension needs to use the proxy for specific API calls, ensure it respects the global proxy settings in VS Code. You can also configure proxy settings directly in the extension by setting the following in your `settings.json`:
+   
+   ```json
+   "http.proxy": "http://<proxy-url>:<port>",
+   "http.proxyStrictSSL": false
+   ```
+
+5. **Restart VS Code**:  
+   After configuring your proxy, restart VS Code to ensure the settings are applied.
+
+For more advanced proxy configurations, refer to the official [VS Code documentation](https://code.visualstudio.com/docs/setup/network#_proxy-server-support).
 
 ## Installation