Sprite animation for me is like my relationship with Dragon Ball. I adore the original Dragon Ball for the very straightforward martial arts display and struggle without much flare or uneccessary excess to the process.
Although still a fan of Dragon Ball Z, I found that the overuse of repetitive flare and excess to be a bad turning point for me. The point of the analogy is this, modern day sprite animation either focuses on the fundamentals of animation or simply flare and repetition. What I enjoyed about this animation in particular is a subtle blend of great, basic animation and a few "modern" elements and effects.
More bluntly put, I find myself enjoying this animation much more than work by say.. Proxide or some of the other bigger names in sprite animation. You've done a great job taking two sometimes counter-acting elements of the genre and formed an accurate and balanced presentation of them together! I really do look forward to seeing more work like this, and I'll be keeping an eye on you in my favourites.
((P.S: Story wise, I think there could have been a more elaborate background on why Karin was using the Satsu no Hadou plus Sakura's minor use of it as well (Air hadouken, Gou hadouken, etc) but it didn't effect the enjoyment at all, this is just coming from a long-time Capcom fan, heh.))