Now let's position the water on your text. Unhide water1 and
duplicate it, hiding the copy you just made. With the Mover tool,
position your water over your top row of text as desired, I set
mine about halfway down:

I have used yellow as my backdrop so you can see easier what's
going on.
When you have the waterline set where you like it, go to selection/load
from alpha channel and you'll see your text has marching ants,
click on Selection/Invert and make sure your on your water1 layer,
and hit your delete key. This will cut away the water from your
top lettering! But you still have the bottom letters filled with
water so you need to Invert your selection again and take out
your Eraser tool, set it rather large like 25 and 100% and erase
away all the water from your bottom row of letters. Rename this
layer water1top.
Next hide the water1top for a moment and unhide it's copy you
made, and position this water layer over your bottom row of lettering,
here you want it to sit the same way as the top row, once animated
you want the 2 rows moving in the same direction or it spoils
the effect.
Repeat the Load from Alpha Channel/Invert/Delete step and there,
you should have both rows partially filled with water! Renaming
your lower lettering water layer to water1bottom.
Don't forget to Save Your Work ;-)
Now we're going to repeat the above procedure for text layer
2 with one exception. When you position your top water2 layer
(remember to duplicate it? you need 2 copies *s*) line it up exactly
matching up on top of Text1's water line, then hide Text 1 and
unhide your blank Text2. With the water layer active go to Image/Rotate
using these settings I found makes a pretty good rocking motion:
Same setting is used on the lower lettering as well. So both Text2 water lines are rotated the same direction.
And repeat the wholeeeee thing for layer Text3, except
lol reverse the rotation from Right to Left!!
This is important to achieve the fluid effect! You can get an
even more fluid motion by adding more layers and rotating more
gradually or more drastically (depending on the turbulence your
looking for), but for the size of this animation, I found 3 total
frames does the trick pretty well :o) Be sure you pay attention
here or your going to end up with a jumpy animation.
When you have all your text layers filled with water, you should
have a palette like this one:

Next we need to add a final layer to add some depth to the lettering.
Go to Selections/Load From Alpha Channel and add a new layer,
using Effects/Cutout with these settings:

Duplicate this cutout layer twice and rename all 3 layers cutout1,cutout2,
& cutout3.
Now we can begin merging all the components for each layer!
Hide all layers except those with 1's and your ready to Merge
All visible

Rename this newly Merged layer TEXT1
Repeat Hide all layers except those with 2's and your ready to
Merge All visible,
Rename this newly Merged layer TEXT2
Repeat Hide all layers except those with 3's and your ready to
Merge All visible,
Rename this newly Merged layer TEXT3
Now your layers palette ought to be looking a bit more manageable
*g*
You should have TEXT1,TEXT2,TEXT3,backdrop,Layer1(your blank
layer) listed from top to bottom on your palette.
Save your work and let's move onward :o)