If this is said to someone, then that person is ready to understand or undertake something, any subtle signalling of it is sufficient. The context is usually of some undertaking that is borderline illegal or of sexual innuendo.
This saying is in fact a 16th century phrase originating in England. The longer version of the phrase is 'a nod is as good as a wink to a blind horse'. It might seem that this is just an elaboration of the shorter version, but it appears that the 'blind horse' version was in fact the original.