Compressing Walls and Incompressible Water

Dear All,

Could you please kindly help me to solve the singularity problem, occurs in the attached model.

This model concerns about a 2D projection of a water container. There are 2 walls, compressing the enclosed water. So, due to the compression pressure, water bulges out of 2 upper and lower open boundaries. I ignored weight force.
So, the 2 left and right compressing walls approach each other by a constant defined speed, causing water to go through 2 open boundaries.

It is a very simple model, but there is singularity, which I couldn't solve it.

I am looking forward for your invaluable advises,

Thanks in advance,

Payam