Ishmael seems to disappear again; all the evidence suggests that we’re immersed in third-person omniscient narration.
Two seamen, Cabaco and Archy, are in a line of seamen who are passing buckets of fresh water along in order to refill the scuttle-butt (cask of drinking water) from a fresh-water butt (extra barrel of water).
Flash History Lesson: The scuttle-butt is the water cooler of the nineteenth-century sailing ship. Like the water cooler, the scuttle-butt is a place everyone gathers to have a drink and a chat. As a result, "scuttlebutt" has come to mean "rumors" or "gossip." Some people (sailing enthusiasts and nerds) still use the word with this meaning.
Ironically, however, because the men have to stand on the captain’s quarter deck to do this chore, everyone has to stay completely silent out of respect.
It’s so quiet you can hear the sail flap.
Archy hears a noise like a cough and whispers to Cabaco about it.
Cabaco doesn’t hear it and makes fun of him for thinking he’s got super-hearing.
Archy claims there is someone hiding in the after-hold, someone who hasn’t been seen on deck yet and who Captain Ahab knows something about.
Cabaco still doesn’t believe him, but we recognize a really broad hint from Melville when we see it.