The number of words that my baby understands continues to grow. It is fascinating to watch her communicate how she knows some of them. She will wave "bye-bye" when instructed, although the wave may be fleeting, covert, and/or late depending on her other interests at the time. She will clap on command, and knows that it is a way to express joy or excitement. She shakes her head vigorously when the word "no" is used. This has an interesting side effect. When she is heading off to do one of the two or three things that I have been very consistent about not letting her do, and instructing her "no" when I move her away, she shakes her head no. It's a great early warning system.
The most consistent demonstrations of her understanding come in reading. She knows the stories so well that she does the actions as we are turning to the page. In the book that says "no, no" she shakes her head. For the book that "says good bye" she waves. And when the hungry catepillar turns into a butterfly, she claps.
And of course, for the books with serious rhythm, she dances.