When you reach the end of the chain, jump left and go up to use the lever that will lower the rope. Slide it to get to the opposite Steed. You'll encounter your second boss battle here, and your opponent will be none other than Theseus himself.
This battle can be tough, as you probably don't feel all that comfortable with the controls yet. In the first phase, Theseus will use his spear to attack you. Take advantage of the fact that your blades have greater range and keep him at a distance, rolling all the time. Don't try to attack him with any combos and stick to single blows (). After a while, your opponent will activate the second side of his lance and will start to summon energy beams from the floor. Luckily, they are very easy to avoid. When you deal enough damage to him, he will jump on the nearby roof and start shooting projectiles at you. Avoid them, using your bow to hit him whenever possible (it's good to have lvl2 Typhon's Bane, as it gets a lot faster then).
When you are out of mana, Theseus will summon two Minotaurs. Defeat them and you'll regain some of your magical energy. Use it to hit Theseus with your bow. You might have to repeat the whole process 3 or 4 times. Theseus will eventually fall down from the roof. Approach him and press O to execute a fatality. You'll have to rotate the left analog stick according to on-screen instructions to get him down. Finish him by tapping O when prompted.
Enter the newly opened room and grab the chests' contents. Leave through the corridor on the right. You'll see another chest in the background. Take some red orbs from it, and then go back left and up, to reach yet another chest and a rope. Use it to get back to the other Steed. Open the door there (R1) and use the altar. You'll be granted another power - Chronos Rage. You use it by pressing L2.
You now have to defeat a group of enemy soldiers - for the time being you have unlimited amount of mana at your disposal, so just tap L2 to get rid of them all in style (you can get a 700-hit combo in here!). Leave using the corridor on the left. You'll see a chest with Phoenix Feather in it. Besides, there's a save point and a red orb chest on the Steeds back. Go along the path to the left from the save point until you reach a platform between the Steeds. You'll see 4 turnstiles on it. First use the green one, then quickly run to the left, climb the wall and press R1 when you reach the mechanism. Then use the red turnstile and quickly run to the mechanism near the Steed to the right. Go back to the turnstiles and this time use the blue one. Run to the right and use your blades (R1) on a flying Imp to get across to the far Steed. Activate another part of the mechanism. The last Steed can be activating in the same way, using the fourth turnstile.
Go back to the turnstiles and activate the mechanism on the platform. Use it again. This time you have to perform some moves with left analog stick. You've done it, the Steeds have been activated. They just moves the whole island for you, phew.
Run towards a save point. Jump down and face a large group of soldiers and Minotaurs. When the passage is open, go down and run along the chain back to the island.