A new version of WhatsApp currently in its beta stage contains quote feature and a reply button when any message is selected. The version that bears the changes is noted as 2.16.118.
So, what are the changes? Once you install the latest beta of WhatsApp, you should see a reply button at the top of the screen among all other options such as delete, star or forward when you select any message in conversation, whether it is a text or a media message. When you tap it, you will see the quoted message as a preview on top of the text entry box. You may choose the x button to remove the quote.
When you send reply, it will appear inside the conversation along with the quoted message on the top. You can tap the quote message to move to the corresponding message. You can even quote other participants in chat and the media messages show up along with the preview inside the quote.
These changes were spotted by Android Police, which posted screenshots to substantiate the features. If you also want to experience them, install the beta v2.16.118 that is available on APK mirror or download it from the Play Store beta. In case you don't see the changes, try uninstalling and reinstalling the app. It might also pop up in the older version of the app such as 2.16.116 or 117, which could be due to a server-side switch.