How Well Do You Know English Slang?
late 13c., "be a sign of, indicate, mean," from Old French signifier (12c.), from Latin significare "to make signs, show by signs, point out, express; mean, signify; foreshadow, portend," from significus (adj.), from signum "sign" (see sign (n.)) + root of facere "to make" (see factitious). Intransitive sense of "to be of importance" is attested from 1660s. Meaning "engage in mock-hostile banter" is American English black slang first recorded 1932.
...'signifying,' which in Harlemese means making a series of oblique remarks apparently addressed to no one in particular, but unmistakable in intention in such a close-knit circle. ["Down Beat," March 7, 1968]
To make provocative comments in a gamelike manner; snap, sound: any black kid who has stood in a school yard or on a street corner engaging in the mock-hostile banter that blacks call ''signifying''/ In Chicago you still get people doing the old-style rhyming; that's called signifying (1932+ Black)