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Although next to useless, the foul-tip signal does indicate when less than two strikes that you know the ball struck the bat, but that it was a foul tip, and thus not an out. Sort of like the little safe signal on a trapped catch.
OBR 6.05: "A batter is out when—
(a) His fair or foul fly ball (other than a foul tip) is legally caught by a fielder;"
I too give it mainly because my association trained me that way.
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