You'll know when your over-trading. You take trades for "The fun of it" and take trades that are not perfect set-ups with regards the system your trading. If you find yourself doing this then restrict yourself to 3 trades a day and that way you'll only take the good set-ups in the day. Trading 3-5 times a day is not over-trading IMHO
As FB says above, you should only take the set ups that fit your system.
Some days you may have several set-ups, other days none.
The more marginal the trades, the more likely it effects not only your bottom line but also your confidence when it comes to increasing your trading size, and in the end, that is what makes the real difference to profitability.
I notice that my average profit per trade goes down dramtically when I trade too many times, so I keep saying to myself "Quality not Quantity". In my better weeks I probably trade no more than 6 to 10 times.
There is another side to it, and that is that it is difficult to make lots of "good" buy and sell decisions in one day, and therefore I think it works better when you take fewer, and quit before you are mentally tired.
The other crucial thing is to recognise the "marginal trading enviroment" - ie if you are a trend trader, rangebound or just dull news days should make you wary of pushing your trading too much. Just quit and leave your desk - it's much cheaper !