Welcome to the game, fellow players. You begin by facing 2 regular thugs; they are your experimental lab mice. If you've read the basics section, you should know that there are a few basic but critically essential techniques that you must know for God Hand, especially evasion, guard breaks and evade-cancels (this's under Useful Tactics), so practice those on them. (You'll need to familiarize yourself with them for this 'walkthrough' to be easily follow-able)
When both thugs are down, a fatty will appear. Try dizzying him to get Stinger, which is likely to be your very first reaction attack if you haven't attempted to stomp at any downed enemies. You can dizzy enemies by hitting them a lot continuously and breaking their guards.
Once down, look to the left side of the town and you'll see 3 regular thugs bullying a villager. Get them. =) This is a good time to try out some of Gene's free moves, especially Face Kick (dash + ). Keep on experimenting with these thugs, only, whatever you do, don't kill the villager. Taking out the 3 thugs will bring out 2 more thugs; just keep practicing. If you're low on health, run into the house on the right (from where you begin the stage) and the villager you just saved should give you a fruit (healing item).
Before you enter the Saloon building, circle/run around the area where you fought the 4-5 thugs. Keep doing this until the ground rumbles and a statue emerges from the ground. Whatever the hell that is, keep hitting until it explodes, leaving you an item (mainly cards).
Back to Saloon, there are two doors to enter from; I suggest entering from the right. Inside are 2 regular thugs, so keep practicing. On the other side around the corner is another thug sitting by a table.
The moment he's down, your first sub-boss will appear. The demon looks intimidating but no worries. By now you should have earned enough TP (tension points) for one godhand unleash (press R2). This makes this demon stupidly easy to defeat. Just mash  fast enough and he'll be dizzied by the time your unleash ends, and then enjoy the reaction attack. If he's not dead yet, you can either punch away or try this for fun: Do Ball Buster (roulette) and then press O for the mighty Poke of God. =) It's nothing but entertainment, really. XD
If you don't have enough TP yet, stay close to him, keep punching and try to break a guard or two. If he attempts to attack, simply duck-evade (forward on right analog) them all. By then you should have enough TP.
Now that the demon is gone, attempt to go up the stairs where you came from and a fatty and regular thug will break in from the ceiling. Take care of them and break the boxes upstairs for items, then leave the building.
Once out, 3 thugs will approach you from the left. You can keep practicing on them or throw the nearby explosive red can at them from a safe distance to finish them quickly. When you're done, turn around the corner to where you found the explosive can and you'll meet with a thug holding a wooden plank.
Enemies holding weapons of any kind are dangerous due to the weapon's damage. Take him out ASAP and avoid his swings by back flipping or ducking (recommended). They generally swing 3 times; the first 2 are duck-able, the last one has to be side dodged/back flipped. However, it's easier/better to just duck the first 1 or 2, then punch them in the face before they swing again. Doing it right will result in a counter, which will kill him even faster. This applies to all enemies with weapons.
Such enemies drop their weapons when they're down (or dizzy), so make sure to pick it up unless you want to save it for later. If you go back to the area where you started out, 2 more thugs will appear. If you don't wish to fight them, just don't go there and proceed to the alley where a thug awaits.
If you have the wooden plank in hand, throw it at him (press X). It'll kill him immediately. There's another thug with a weapon (steel pipe) at the end of the alley. Save the weapon he drops for later. Turn to the left and you'll see another thug with a sledgehammer at the far end. After killing him, pick up the steel pipe from the thug before and stop in the center of the area where you see a fatty sitting on top of a villager. Do not go past the door on the right side, and throw the steel pipe at the fatty. He should come after you now, and if he doesn't, taunt him (L2). Punch out the remainder of his life and another demon will appear. .
Pick up the sledgehammer from before and throw it at him. Then, either finish him the usual way or unleash godhand if you have it. When that's done, run into the alley past the door and 3 thugs will appear. Personally, I'd use La Bomba or the wooden plank from before against them. (La Bomba is your best friend for most of stage 1).
Talk to the villager hiding in the nearby room for your reward, and then break all the objects you haven't broken. Don't forget that there's a ladder leading to more boxes on a roof.
Notice the beautiful sign Olivia pasted on your back? That thing is what you'll need to keep throughout the game IF you intend to do the "Kick Me Sign" optional challenge to unlock something in the game. Check out the jukebox section for more information.
Anyway, first thing you'll be dealing with are 3 thugs, one of which is elite. Elite refers to 'tougher' enemies who cannot be launched/juggled anytime like the non-elites. (For example, face kicks will not send them flying back.)
Assuming you're doing a regular run, quickly run past them and get far enough until the enemies stop chasing you, then turn around and taunt at them one by one to single them out. Against the elite, regularly break his guards and duck his attacks. Notice that there's also an explosive can you can use nearby.
When you're done, break all objects, collect any items, walk up to the starting end of the bridge and turn 90 degrees left. You'll see this shining red Little Devil past the fence with a couple crates. Break the fence and talk to Little Devil for an optional challenge. You'll be rewarded with gold if you clear it.
If you have 2 roulette orbs, this will be really easy and quick. There are 3 waves of enemies in total. The first wave consists of 3 regular thugs, and the second wave 2 regular thugs and 1 fatty. They are easily disposable using La Bomba. If you have no roulette orbs, face kick the thugs to death (considering they're not at LV Die) and deal with the fatty the usual way. The last wave is a lone elite with a gold club. If your godhand is ready, use it and he'll be down in no time. If not, duck all his swings and counter in between to stun him, then attack.
After the Little Devil challenge, run across the bridge and you'll encounter 2 fatties and 1 regular thug. Stop at a little distance and the fatties will automatically approach you. On the bridge, you can break their guard and do a High Side Kick (or Barrel Roll Kick) to send them flying off the bridge for an easy win. Regular thugs are even easier; just face kick them. When one fatty is down, 2 more thugs will join.
From where you start, look to at Gene's 1 o'clock direction and you'll see 2 thugs (1 elite) and a wooden plank on the ground. Run towards it and grab the wooden plank before the elite does, then run past them or back flip away before throwing it at the non-elite (or better yet, both). There's a pretty good chance that either of them will turn into a demon so be prepared.
When finished, approach the building on the far left to deal with 2 more regular thugs, one of which comes out from the door. (Whatever you do, don't venture beyond the wide-open area past both buildings on the left and right, yet.) Inside that building is an elite thug and a villager. Taunt or throw an object at him to lure him away from the villager, then kick his ass and the villager will reward you.
Now leave the building and walk past the center where you see 1 fatty, thug and midget and a cutscene will appear. Bottom-line, the villager's poisoned and you have to obtain the antidote from the midget to save him but he's escaped past the gate and you'll have to beat the fatty and thug first before it'll open. You can do a La Bomba or throw the explosive can nearby at them to kill them off quickly but do it away from the villager. You don't want to kill him accidentally for any reason.
Once the gate opens, run into the first house on the right (be careful, there's a thug with a sledgehammer behind the wall) and you'll see the midget by a ladder. He'll run away as you approach him so quickly chase him down. If you can get close enough to him, do a face kick and roundhouse-cancel (roundhouse kick + evade-cancel) him to death as he tries to get up. (Refer to Useful Tactics for info on evade-cancel.)
Pick up the antidote and talk to the poisoned villager and you'll be awarded with a sweet roulette – Dragon Kick. Right now you'll have about 11 enemies left – 1 sledgehammer thug + 2 regular thugs, 3 more regular thugs (they come down in a hot air balloon), 1 fatty (by the door to the next area), 1 fatty + thug (if you enter the big empty room with many crates on the left) and 2 more thugs (if you haven't entered the house on the right side).
Phew. When you're finally done with them, turn around the corner by the door that leads to the next area and you'll come upon the second Little Devil. This challenge is hella easy – just roundhouse-cancel it to destruction, no sweat.
Boss Fight - Mr Gold & Mr Silver
Welcome to your first boss fight. =) Here, you'll be dealing with 4-5 waves of enemies depending on your enemy level. The first 2 waves consist of 2 regular thugs each, the third wave 2 fatties, the fourth 2 elite thugs (you fight them only if your enemy level is LV 3 or Die), and the last Mr. Gold & Silver.
The first 3 waves shouldn't be a trouble but the fourth wave with the 2 elite thugs is likely to be. I suggest that you build up your TP using the first 3 waves and unleash godhand (hopefully you have it) on them to take one out quickly. If you don't have godhand, spam Low Roundhouse Kick (or Reverse Sweep) to counter them whenever you can. You'll need quite some luck for this.
Against Mr. Gold & Silver, I suggest you use the 2 roulette orbs you've saved (hopefully). The moment they enter battle, run around the field and wait for them to perform their collaboration attack where they say “Here I come~”. Once you hear that, run right up to them and perform Dragon Kick. That alone will take out 70~90% of both their lives. Cheap, yeah, but hell it works =P
These two sissies are a real pain in the ass if you were to deal with them normally. They might have 10~30% health left but they can still kick your ass. If you have enough TP (or more roulette orbs), unleash it immediately and take out one of them with it, then you can deal with the other one regularly. If you don't have godhand, try your best to attack just one of them and keep the other behind the one you're attacking so that his attacks don't reach you. You can do this by punching a few + side dodge + punch a few + side dodge etc. Just be careful of their annoying butt attack and mid-air thrust kicks and back flip away from their grabs.
The next area (after beating them) has a few barrels that drop some items. Kill off the only thing here that attacks you and proceed to enter Elvis's mansion. =)
First thing you see is a sledgehammer thug on the left of an Elvis statue, and a regular thug on the right. Try taking out the sledgehammer thug first (if possible) for his sledgehammer, then check and see if your TP is (near) full. If it's really low, punch that Elvis statue until the book he's holding drops, then check out the book. =D If not, leave it for later.
Now, enter the door on the left and you'll see 1 elite thug behind a chair. If you still have the sledgehammer, whack the chair first then throw it at the thug. If not, just punch away. Note that there's a good chance that this thug will summon a demon when defeated. In any case, pick up the rosary cross that he drops and leave the room.
Once done with the two, enter the blue door by the stairs. In here, you'll face 4 waves of enemies – 3 thugs, 2 thugs + 1 fatty, 4~8 midgets, 2~3 elite thugs, and most likely a demon. So long you're not on LV Die, face kicks and roundhouse-cancels alone should be enough to slaughter the first 3 waves. If you are on LV Die, I assume you'd know how to deal with these weaklings. LOL. Against the 2~3 elite thugs, unleash godhand. Clearing this room will earn you your second rosary cross.
Now that you're back by the stairs, kill off the 3 regular thugs waiting for you, including the one on the second floor. Then, follow the corridor to the end and you'll see 2 elite thugs guarding a cursed door. Stand right by the corner and taunt at them; the one closer to you should come over on his own. You should know the rest.
After they're down, enter the small door on the right where a fatty awaits and throw a crate at him. Once the ladies run off, beat him up (he'll drop the last rosary cross) and a demon will arise; just deal with him the usual way. Before you unlock and enter the cursed door, remember to go back downstairs and claim your reward from the 2 ladies you just saved.
Boss Fight - Elvis
"Finally, a boss fight." Ignore that. You know this is your 2nd boss fight, unless like Gene you decide that underlings don't count as one. >_>” Anyway, against Elvis, duck all his punch attacks, back flip away from his ‘Jump & Crash' attack, and side dodge his fireballs and dash attacks and you're good. His “smoke screen” move can be avoided by either back flipping or side dodging (if you're really close to him), but if it gets to you, back flip all the way for safety.
Just keep punching, break his attacks, and duck/avoid his hits carefully and you should finish him off. He gains more speed if you're dealing with him at a higher level, so adjust your evasion timing, which may be easier said than done, but good luck anyway! =P
Now, the one thing you MUST remember to do in this battle is to open that gold chest behind Elvis's chair for the cheapest technique ever – Yes Man Kablaam. I don't think anyone will miss something so obnoxious but you know… just in case.
Proceed to Stage 2 >>