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Add "mark as read" option for posts and comments
(hexbear.net)
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Well, I've turned on that feature as a test (after the question was posted) and I saw your reply just fine. That's no difference from how it's been before I turned on the feature.
What has never worked for me (I'm not sure if it's a bug or by design) is a notification for a reply to your reply. I only ever see notifications of direct replies, not indirect ones.
In other words, if someone replies directly to me, I know about it, but if someone replies to that reply, I don't.
Definitely by design. I do not want to receive a geometrically increasing number of notifications as a comment chain expanded underneath my comment.
On reddit (maybe it was the Enhancement Suite) IIRC is an option to Watch a thread, which basically did what you want