One of the things I love about teaching yoga is when a student comes up to me after class with a question...I just LOVE it. Maybe because I am a nerd, or because it is an obvious sign of deep study and interest, and of great studentship...but I am honored and validated each time someone approaches me after class with a question.
After my last class at Black Dog, a new student to yoga [her 3rd class] asked me, "When do I know to move to a more advanced class?" I told her this:
When you can keep your breath even and uninterrupted for the entire practice.
My reasoning is this: The body-mind is complicated and one part will often try to outweigh the other. The mind will see others doing things with their bodies and think that the body is ready to receive positions that it really cannot support wholly. The mind may desire a more advanced practice or feel bored in the current level of hatha yoga, creating an illusion of readiness.
On the other hand, I have had the experience where I was bored in my studio practice and for fun took a more advanced class with my teacher. Turns out that my body WAS ready to support more advanced poses but my mind was over-cautious and doubtful.
In the end, I told her that [especially because she had chronic radiating pain from her wrist to forearm] the most simple way to know when you are ready is to listen to your body and respect what it is telling you, and then, to always come back to your breath. And when you feel that in the most strenuous of hatha practices your breath is sweet and easy, then you are ready to explore new classes and poses.