I hold the right needle on top (knife hold?) and use either the middle finger to wrap the yarn, more likely with knits, or the index finger to wrap the yarn, more likely with purls, but I canuse either finger for either stitch. I also put whichever finger under/behind the yarn to wrap it around the needle, I have a lot more control that way, a lot of people put their right index finger in front of the yarn and push it around. I let go of the right needle every time but I don't drop the yarn.
There is no "correct" way to knit, it's whatever you find easiest, quickest, gets an even tension and doesn't inadvertantly produce twisted stitches.