Hi, that's not overwatering, it's drowning! Make a firm little scratch halfway up the trunk and see if it's green underneath. If not, your tree's a goner. You must water them the same as any other plant (in this respect anyhow) and that's from above, when the top layer of soil and a bit more is dry. If your soil is fast draining (as it should be) and full of grit (not peaty potting soil) the water should quickly come out the drain holes. If it's not doing that, you need to repot with a mix of coarse (larger particle) soil mixed 50/50 at least with grit (even perlite's better than nothing). Don't do it instantly, first check for viability, then allow things to dry out for 2-3 days (not a lot more or you'll have the opposite problem), then have all your stuff ready to repot and go for it. If there are slimy blackish roots, you need to cut them back to dry, cleaner places, but if most roots are bad most of the way up, I might consider a new tree.

Whoa, your tree is in trouble for sure. I don't know who sold you it but the advice they gave you will only guarantee a dead tree. It is my opinion that based on the faulty advice you where given you are owed a replacement tree at the very least. You could try and save the one you have, but then you are being set way back. You did buy a healthy tree.

I just bought a Chinese Elm yesterday and the (correct) advice I was given is water when the soil begins to dry which depending on the soil and climate could be every couple of days, but not every day.

Hope this helps.
Ed Merc

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