I learned this from Gerry Armstrong at the OTSFM many moons ago: (she said she got it direct from Bessie Hawes Lomax, whose book you can find great stuff in) as:
Draw me a bucket of water
For my oldest daughter
We got none in the bunch, four outside,
Draw me under, Sister (Sally).
Start as Joe described above. Two pairs of hands, seesawing arms across (parallel to floor). It works best if the 4 players are of ruighly equal height.
After the first sing-through, one side pair of arms -- any side pair -- is lifted up and one player comes under and inside.
Then you sing:
----
----
We got one in the bunch, three outside,
Draw me under, Sister (Sally).
Continue until all four players are "inside." They will now have woven a basket (bucket) with their arms. All lean back, giving weight (dancers will understand this term - it requires a modicum of trust), and then jump in a circle singing, "Frog in a bucket and can't get out, Frog in a bucket and can"t get out."
I use this all the time. The kids love it and usually collapse on the floor giggling.
(sigh.) I learned several play-parties from Gerry, all of which are gems.