They are both correct.
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adi012You look lovely in this picture.That's what I would say.
adi012You look lovely in this picture.I'd say this. I think I'd use "are looking lovely" in the case of a woman who is dressed up for a special occasion - standing before me - not in a photo.
imantaghaviWhy not the other one?ImanSee CJ's explanation. I agree with him completely.
imantaghaviI mean is that because of using the word "lovely"?Certainly not. When you see someone in a photo, they are already there, so to speak. It's a "dry" fact.