The scriptural reference is: Ex. 17:8-13
A good article that refers to it is: "The Shield of Faith" (Ensign, May 1995) -- it actually talks about how our raising our hands is symbolized by Moses holding his hands up during this battle.
I am going to have a child come up front and hold
up their hands as an object lesson (allowing them to get tired and have
two other kids come hold up their
arms)... I'm thinking about getting a staff and everything. :O)