Awesome summer experiment. To set this experiment up you need to put a small whole in the bottle of the bottle. I used a one liter bottle, but you can use any bottle. I used a nail to put the whole in the bottle.
Then put the balloon in the top of the bottle and starting blowing up the balloon. When you ready to stop cover the whole with one of your fingers. Now the balloon will stay blown up. If you don’t put a whole in the bottle then you won’t be able to blow up the balloon. The bottle already has air in it and with no whole you can not blow any more air into the bottle (Balloon). Once you have a whole in the bottle and your finger is off the bottle, now when you blow air into the balloon, air inside the bottle will exit the whole. Once you cover the whole the balloon stays full because air pressure all around the balloon pushes to keep full. Once you release your finger on the whole the air pressure outside the bottle will push on the balloon and push the water out of the bottle.