Damage Conversion
Some skills or items convert a portion or all of one damage type into another.

This conversion happens after damage increases and more multipliers.

Example: converting 50% physical damage to cold damage.

4. Damage Penetration / Reduction
Apply penetration modifiers that reduce enemy resistances.

For instance, if an enemy has 30% fire resistance and you have 20% fire penetration, the effective resistance becomes 10%.

Penetration happens before applying resistances.

5. Resistances and Damage Taken Modifiers
Subtract resistances (fire, cold, lightning, chaos) from the damage.

Resistance can be reduced or increased by buffs or debuffs.

After resistances, apply any damage taken increase or decrease modifiers on the enemy.

6. Damage Taken From Hits / Damage Taken From Spells
Separate modifiers for hits and spells apply at this stage.

This allows different damage mitigation or Path of Exile 2 Currency amplification depending on the source.

7. Global Damage Taken Modifiers
Apply modifiers that affect all damage taken by the enemy.

8. Damage Avoidance
Includes chance to block, dodge, evade, and other avoidance mechanics.

Avoidance happens after damage is calculated but before HP is reduced.

9. Damage Over Time Calculations
Damage over Time (DoT) effects follow a slightly different order.

DoTs usually have their damage calculated after some initial damage modifiers but POE2 Currency for sale before avoidance.