Max 20 colors (if this is for the challenge. you haven't marked it as such though) Shouldn't be a problem, most of the colors in your palette aren't particularly useful anyway, so the palette can be compressed with no real loss of detail.
The image needs more contrast overall. You're currently at 31 colors, here's an edit at 16.
Might want to mention that you referenced Kyo from King of Fighters here...