Do you really want to measure the amplitude of water waves? That could be very large, in a storm.
If you just want accurate measurements of the water level, I agree with Hackscribble, averaging over long periods will work -- the zero frequency term of the FFT is just the DC average over the entire sample.
A common approach to reducing the effect of wave action on water level sensors is to put the sensor in a "stilling well", which is just a wide, vertically suspended and partially submerged tube open at both ends. The tube has to be rigidly suspended so that waves don't knock it around.