"Street performances" are just concerts your Tamagotchi will do if they haven't made the audition.
At 5 PM, 6 PM, and 7 PM, your Tamagotchi may be called to have a concert. The fourth icon will light up. Select it and your Tamagotchi will go perform at a concert.
(If you want to cheat and have a concert right now, set the time to 4:59 PM, 5:59 PM, or 6:59 PM and wait a minute. If you miss the 5 PM concert, you will have another opportunity at 5:15 PM. If you miss the 6 PM concert, you will have another opportunity at 6:15 PM. If you miss the 7 PM concert, you will have another opportunity at 7:15 PM. Your Tamagotchi can do up to 3 concerts per day.)
When your Tamagotchi Music Star has not yet made the audition, you will be able to do these concerts but you will have no flashy special effects on screen (so their concerts will be less snazzy) and your Tamagotchi's "star ranking" will not go up until you pass the audition.
In order to pass the audition next time around, make sure you practice your instrument, play games with your Tamagotchi, and most importantly practice with your band! (If you don't know how to do this: Select the 5th/door icon from the main screen. Select "Away" and then choose the first game that comes up. Play the game a few times.)
