This update probably won't matter to anyone but I'll post it anyway haha. I saw another dermatologist who doesn't believe it's an allergic reaction because I already have grey tattoos and allergies to grey ink are extremely rare, also tattoo allergies typically represent reactions on the surface of the skin, not swelling underneath like mine. Infection is also unlikely because the reaction is localized only to the area where the needle hit the skin. He believes that the tattooing was perhaps too aggressive which created a deep tissue wound which caused excessive inflammation, thereby preventing proper healing and perpetuating more chronic inflammation like a vicious cycle. I started using a powerful steroid ointment today and the swelling has gone down considerably. Hopefully by keeping the inflammation under control the deep layers of the skin will heal properly.