Hmm it took me a long time to figure out which HP bar was mine in the battle. I think putting the bars at the same vertical position would eliminate any room for confusion. Otherwise I think there needs to be a bigger time step between the player and enemy attacks so that you can clearly see which hp bar is being affected between each attack effect.
I liked the color palette and graphics, the kraken overworld sprite was especially cute!
I got the axe and bomb but wasn't sure what to do in the sandstorm, I found a lot of blocked or hidden rooms after getting the items but maybe I missed something.. nice work!