Is it recovering?

I have a 45 page site which was ranking in 1st page for about 4 keywords and some other long tail keywords. I got the unnatural link message through WMT on Mar 21. Aftre onew week rankings started to drop. Then they launched penguin and my website throwed into last page. All the keywords which were ranking on 1st page droped to 600+ positions. But some innerpages with 0 backlinks started to ranking in 2nd and 5 th page. Almost all top ranking sites in my niche faced the same problem.

Then, after waiting morethan 2 months I decided to start over with a new domain because I reduced the keyword density, reduced onpage seo but nothing helped. I deleted entire content and removed all pages except homepage from google. Then I bought an EMD and uploaded the content to it. At the same time I uploaded a 500 word article to the old domain's homepage and added a policy page.

Now its almost 3 weeks. New site is nowhere in SERP. But since somedays, as per serpfox my old site is ranking in 27# th position for a keyword and #120 th postiotn for another keyword. Other 2 keywords were also ranked yesterday at around 150 th position but now disappeared. That 2 page site has only 1 page of content now with around 8% keyword density (it was around 6% when penalized).

WMT was showing around 1800 links previously. Now droped to 710 total links.

So is it recovering? Should I replace the content from new site to old site?

Thanks in advance.

Forgot to add. My site is not showing anywhere when I search for my brand name since it penalized. Is it indicates a penalty?