I kept on Googling until I came across Blender http://www.blender.org/ . Not only is the software capable of fluid simulation but it is actually free. Before Blender all the modelling and rendering is done at the office. Now I can do it at home. Blender is 3D modelling, rendering and animation for the masses!
The first scene I did was a drop of grey colored liqid falling inside an invisible box.
The next one I did was this liquid flowing through an opening to an invisible pool.
Tsunami test animation.