I'm not sure if you want to manually choose the colours yourself or just set AI to use a specific amount of colours when using Live Trace
, I'm mostly confused by the term Image Trace
, but I'm assuming you mean Live Trace.
To set the amount of colours you will allow Illustrator to use with Live Trace
, either click on the Live Trace button and choose Tracing Options
, or Object > Live Trace > Tracing Options
.
You will see a dialog box like so:

In the Max Colors
option you can choose from 2 to 254 colours for your Live Trace.
If you wish to use one of the preset options for the Live Trace, you can do so first and then go to Object > Live Trace > Tracing Options
to adjust the number of colours used afterwards.
Please leave a comment if this has nothing to do with what you're trying to do.