Attack power, Sha-Chi (stamina) and HP are increased by collectibles you find or get by defeating enemy encounters. Specifically: Blackstone, Sha-Chi Amber, and Memory Flowers.
Investigating objects or notes rewards Remnant Dust (souls) in Phantom Blade Zero, but can also reveal new sidequests.
Your regular attacks (X on controller) don't consume stamina, but they will deal damage and chip down a boss's Sha-Chi, so be aggressive.
Besides granting HP and story fragments, collecting all Memory Flowers before a region boss often gives them an extra phase or sometimes a unique reward, such as a weapon. You'll be introduced to these in the Crimson Forest.
When an attack flashes red, hit the right bumper on controller. When it flashes blue, hit the left. Or if you're struggling to react or remember, just hit both.
You'll first experience these stamina-draining attacks fighting Peng Meng, where the boss emits a smoky black aura. Dodge these instead of blocking to retain your Sha-Chi.
Your Sha-Chi combos (Y on controller) cost stamina, but deal more damage—use these after you parry a red or blue attack, or when you've broken your opponent's Sha-Chi, meaning they can't block for a while.
You can refund all materials and Remnant Dust from an upgraded weapon or Phantom Edge. It's free up to Level 10. After that it costs a reforge talisman, which are easy to find.
Every five upgrade levels a weapon or Phantom Edge gain a new ability, either passive or active—make sure to learn what these are to use them in combat.
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