An invalid fair catch signal is when the player signaling for a fair catch does not fully extend his arm above his head. If the players arm is flexed, an invalid fair catch penalty will be called and the ball will be marked down at the spot of the invalid fair catch and then assessed a five yard penalty.
A valid fair catch signal requires the player calling for the fair catch to fully extend his arm above his head. Most players wave their arm as well, but this is not explicitly required. A player signaling for a fair catch is attempting to indicate that he will catch the ball, but will not attempt a return. This prevents the player from being hit by the opposing team. The player signaling does not actually have to catch the ball, but they may not make contact with any player on the opposing team, and normal kickoff rules apply once the ball touches the ground.