Right Click On Ultimate Marvel Vs Capcom 3
Go to manage > browse local files
One there go into nativePCx64 > chr > archive
Drag/Extract the files.

Go back into nativePCx64
Open Characters.ini in notepad
Find Mvc2inel and increase colors from 2 to 10
Save the file.

Note: If you wish to replace palette 1, back up your Mvc2inel_00 before overwriting it.