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Gear Progression in the Elder Scrolls Online
Character Item Slots
From the moment you log on your freshly created character onto the server of your choice, your gear progression starts and it basically never ends.
In ESO, each character has 7 item slots for armor (head, shoulders, hands, chest, legs, feet, waist), 3 item slots for jewelry (neck and 2 rings) and 1-2 item slots for weapons (1 if you wear a two-handed weapon and 2 if you wear 2 one-handed weapons or 1 one-handed weapon and a shield).
Also, at level 15 you'll be able to swap between 2 different weapons. It won't affect the total number of item slots (any any bonus that they offer) since you can't wear both weapons at once. The weapon swap was made available so that you can have two action bars, each with different abilities, at your disposal.
Item stats and bonuses breakdown
The image above is a basic weapon in ESO. The core stat is damage (for armor it would be armor of course). The weapon damage depends on its quality and its level.
The following bonus "Deals 11 Flame damage" represents the enchant. The bonus comes from a Glyph (crafted though the Enchanting profession, purchased from NPC vendors or found as loot) that was applied on the weapon.
Many items that you find in the world as loot from mobs and bosses or as quest rewards already have an enchant. If you\re not satisfied with the enchant's bonus you could apply another Glyph of the appropriate level and change that bonus.
The final stat "Increases weapon attack speed by 10%) is called a Trait. Like for enchants, some items you come across will have a Trait, while others will not. Traits can be added to items by crafters during the creation process. However, you can't apply a Trait onto an existing item.
In ESO, crafting is extremely important. You don't just have the ability to create gear for yourself and other players, you can also improve its quality, thus increase its stats. The highlight of item improvement is you can improve any item (related to your crafting profession(s)) not just the ones you craft.
For example, you go in a dungeon and a boss drops you a nice medium armor chest piece of Superior (blue quality). If you are a Clothier (which creates light and medium armor) and you have the necessary materials you can improve it to Epic (purple) and even to Legendary (orange) quality.
The only items that are currently not craftable are Jewelry (necks and rings). For now, there is no profession that can craft these items, thus they can't be upgraded either.
Looting and buying items
As you are leveling your character and doing quests you'll get many items as loot drops from chests, mobs and bosses, but also as quest rewards. Sadly, most of them will be of Normal (white) and Fine (green) quality. Finding an item of Superior (blue) quality or higher is a rare opportunity, especially at lower levels.
NPC Armor and Weapon vendors are located in all major cities so you can also buy items from them. Nevertheless, those items are pretty expensive for what they offer and most players gear up using their looted/crafted items or buy them from other players.
This is where it gets interesting, in terms of gear progression. In The Elder Scrolls Online there are many item sets for all armor types. Each set offers a bonus (on top of the bonus provided by the individual items) for wearing a certain number of items from that set.
Typically, set bonuses can come at wearing 3,4 and 5 items. Some sets offer only a 3 items bonus, others have bonuses for wearing 3 and 5 items and finally some sets have 3 different bonuses, for wearing 3,4 and 5 set items.
There are three types of item sets: crafted, dropped and PvP.
Crafted item sets
Crafted item sets like their name says, can only be made by crafters. Any kind of crafting in ESO takes place at an appropriate crafting station which can be found in all big cities. However, to craft items from these sets you must go to special crafting stations. For each set there is a related crafting station in every faction.
There are currently 21 craftable item sets in ESO. Each faction has all 21 crafting stations spread throughout their areas. The bad news is, you can't just go and expect to be able to craft any item, even if you have the adequate profession and all the required materials. Each set requires a number of Traits for the crafter to know in order to craft a set item.
As a crafter you can research Traits for your items at the appropriate crafting station. This is an extremely lengthy process because the research times double for each new Trait you research for the same item.
To clear things up let's take an example. Let's say you want to craft a Bow from the Ashen Grip set. This set requires 2 Traits so you must be a Woodworker (the profession that lets you craft Bows) and have 2 Traits discovered for Bows. Obviously you also have to be at the special Woodworking station that lets you craft items from that set and have all the materials needed.
This might seem easy, but there are sets that requires as high as 8 Traits. So for every item of that set you want to craft, you need to have 8 Traits discovered, which is not an easy thing to do. If you are new in the ESO universe and haven't got the basics of crafting, combat, skills and anything else that can affect your progression I strongly suggest you read some related ESO guides. It will help you understand gear progression better and allow you to optimize your character for the best possible experience.
Dropped item sets
Like I already said, you can find items in the world as loot from chests and mobs and bosses you kill. Sometimes those items will be set items. Finding 3 or more items from the same set yourself can be pretty hard so if you really like a set's bonus and want those items fast I suggest you try to buy the missing pieces from other players via direct trade or guild stores if you are part of a guild that has one.
There are many dropped sets (there is no complete list yet) and you can often see a lower level and a higher level version of the same set. Unlike crafted sets, dropped sets can sometimes include Jewelry. The only problem with Jewelry is it can't be upgraded so you must find it at a decent quality to become useful.
PvP item sets
In ESO, when you PvP in Cyrodiil you receive Alliance Points for your efforts. Alliance Points (AP), just like gold are a type of currency in ESO. Using AP you can buy PVP set items from NPC vendors in Cyrodiil.
Each armor type (Light, Medium and Heavy) has 3 sets that can be bought directly using AP. The lowest level set requires Veteran Rank 1 and costs 100,000 AP per piece, the next one is for Veteran Rank 6 and costs 250,000 AP per piece and the highest level set is for Veteran Rank 10 and costs 650,000 AP per piece.
There are also some PvP sets for which you can only buy one item using AP. You have a chance of getting the rest of the pieces from random loot bags also purchasable with AP. A few other sets come only from loot bags. You can see some of them as well as some dropped sets in this list.
There is no special stat for PvP in ESO. PvP item sets distinguish themselves from the rest of the gear by providing set bonuses directly related to PvP (e.g.: reduced damage taken from players). So unless you plan to regularly PvP, these sets won't be of much use to you.