Thank you Cerbera, I suspected that it might have been done in Houdini.
I actually tried to do it with collider deformer before. as i said it works great on the sides but as soon as it reaches the top of the "Cap" it glitches pretty badly , which doesnt happen if you doing it inverted way ,aka not inwards but outwards as in tutorial.
Werd huh...
I will keep trying , but i guess its about time i started learning houdini anyway ...