My cat likes to bite when she's playing with me. I make sure my hand has extra protection, and if/when it doesn't, I don't play with her. She moves her tail when she's getting ready to attack or pounce.

A sign of happiness and contentment is when she closes her eyes. She will also flop herself down on the floor in front of me, and stretch all the way out, and roll over, when she wants me to scratch her with my foot. She does this every morning when I come out of the bathroom after taking a shower.