It's a way to decide who has to do something you obviously don't want to do. These are the rules: someone calls "No nose goes" and the last person who touches his or her nose or whoever doesn't touch it at all is left with the task everyone else just avoided (hence NO nose goes).
There are plenty of versions of this technique. For example, a different one involves everyone having to put one of their feet in the circle (making a circle of feet with the other participants). The last person to put their foot inside the circle is left with the task.
Rick: "Looks like someone has to make the popcorn...No nose goes!" *touches nose*
Everyone else: *touches nose*
-Josh is the last person to realize what is going on and ends up touching his nose last-
Everyone else: "Josh has to make the popcorn."
Josh: "I hate you guys..." *goes to do their bidding*