i don't see overwatering.. i see large portions of medium that looks bone dry, so i doubt it's consistent underneath, either. Also, looks like poor composition with low aeration characteristics.
So many possibilities for this... could be temp/rh (therefore, VPD also) not being in a good range. could be too much light -- this would be easy to eliminate as lng as you see some internode developing etc... The pot isn't ginormous, but a bit too big for a seedling at this stage, which makes watering more difficult / complicated. How hot the soil is, is also relevant -- nearly everything someone pointed out so far is a possibility.
You'll have to eliminate the possibilities... insufficient info to give a single, good answer.
if you can't water in a normal way, it's the fault of composition or using too big of a pot. Use more perlite or similar and not too chunky it physically impedes roots... the danger of partial watering is dry pockets... roots don't grow into dry pockets and nascent roots die in dry pockets. It also creates a context in which the most moisture is at the top instead of bottom/center.. roots turn and grow twoard greater moistuer.. it's automatic. So, partial watering promotes superficial roots.
With a large pot /tiny plant, which this is borderline, you don't water the entire volume.. you do a smaller column around the plant but make sure it goes all the way down... you don't want to promote superficial roots. widen the column as it grows until you can water the entire volume in the pot.
Fully saturating a pot or little seedling container is not overwatering. This is a matter of poor soil composition. if it remains soggy and waterlogged, that's because it's a shitty soil composition and 100% self-inflicted. Watering should never be an elaborate process unless you willingly put yourself into that position with tiny plants / large pots, whic is also 100% avoidable and unnecessary to do 99.99% of the time - maybe there's a context where it makes sense, but i can't think of one.
1) fully water (10% runoff, if soilless grow method is supremely important)
2) wait for dryback and repeat.
It's that simple to water. If doing this causes problems it's due to other mistakes being made. This is absolutely not overwatering.
A great way to assess this is how long it takes between irrigations... it can tell you when it's ready for a transplant or if the pot is too large etc... stagnant water is less than ideal regardless of if it happens in a bucket or already soaked into your medium. The rate the plant drinks helps determine the volume of soil it needs to grow well. somethign you can observe and predictable adjust timing and pot size choices.