Dancing Hands first appear as a sub-boss found on the 10th floor of Thebel Block in Tartarus, encountered in a group of three. This group can be easily dealt with using Orpheus' Bash skill or any other Personas acquired with Strike attacks. They additionally have a minor weakness to every ailment excluding Fear.
They will later impede the progress of the party during the first Full Moon Operation as they attempt to reach the front of the train and the Arcana Priestess. Afterward, they will appear in Arqa Block as regular enemies.
Dancing Hands are found in Halls 5 through 8 of the Steamy Bathhouse in the Midnight Channel. They will generally appear mixed in with other types of Shadows and will play a support role for them. When defeated, Dancing Hand may drop Thick Hide. Selling ten Thick Hides at Daidara Metalworks will unlock the Hard Boots for Chie Satonaka in the shop's inventory.
In Golden, Dancing Hands behave much the same other than losing Blue Wall. They can be found on Baths 5-8 of the Steamy Bathhouse, but may rarely appear in Baths 1 and 2 as Red Shadows. If left alone on the field, they will escape. Selling five Thick Hides will unlock the Hard Boots. It may also drop Smoky Quartz for trade in Shiroku Pub.