From the Super Mario Wiki
There is a large set of tongs floating above the ground in the middle of the screen. The player can press the button to pinch with it. A chicken will run along the line, stopping and jumping when it reaches under the tongs, and the player must catch it by pinching with good timing. If the chicken is grabbed while doing a backflip, it will be held by the legs, instead of the whole body.
In WarioWare Gold, the chicken bugs will randomly have a single hair on their heads. Pinching the hair counts as a failure, as the chicken bug will instantly flee.
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