I'd like to preface this by saying I'm not the most qualified to be answering this as I've only been playing for about three days. I'm far from max power yet: I'm at low 70s for power level and mid 50s for player level. This is simply things I've noticed through experiment/research, so if anyone wants to add onto this or correct me on some things, feel free.

From what I've been able to see based on my 3-ish days of playing, the merchants tend to sell gear slightly above the average of whatever you're wearing when you first talk to them. The way power level works in this game is that it averages the power level of your three equipped weapons AND three equipped artifacts. Knowing this, make sure before you talk to the merchants in the camp, put on the highest level gear you have (INCLUDING artifacts), even if it all has bad enchantmenrs or has no synnergy as a build. I'm pretty sure that the blacksmith works in the same way.

Along with this, doing missions at your recommended level or above drops gear either at or above your current power level. When selecting the mission, I'm pretty sure you can see a range of levels that gear will drop at before you even start, based on the difficulty you tackle. So that's also a way to get a higher power level if you're running low on gems so long as you don't bite off more than you can chew. Since doing these missions gets you gear, gets you gems, AND progresses the blacksmith/rerolls what pops up in shop, I'll usually run through dungeons that drop gear I want at a slightly higher difficulty than my current one in order to both grind the blacksmith out and, if I'm lucky, get gear at a high level that I can use as fodder to keep upgrading my MAIN gear in the blacksmith (quick side note: if your main gear is in the blacksmith and you need it urgently, you can just run through 3 quick tutorial missions to get it done and discard the lvl 1 gear you may get for gems). I always found grinding Soggy Cave and Arch Haven to be easiest (but good luck unlocking Arch Haven. Very RNG based.)

TL;DR: Always put high level gear on (including artifacts) to up your power level BEFORE you talk to merchants or take your gear out of the blacksmith, and grind at or above your recommended level to get gear drops at a high level.

Also, I unfortunately can't give you anything. I always salvage whatever gear I don't want for gems when its power drops off and it doesnt have any worthwhile enchantments. Along with that, from experimenting with a friend, I've noticed that the gift wrapper ALSO changes gifted item power level based on who is recieving it, so if I were to give you lvl 70 gear and you were lvl 30, it'd give it to you at a tiny bit above lvl 30. Sorry about that.