When the minigame starts, Riccardo (the greenish-brown Waluigi) will hit the ball to a random height.

The ball will take 0.5 seconds to travel to your side, and if your racket is not touching the ball, you lose and have to start over.

If your racket is touching the ball, the ball's placement on the racket will determine how high it goes. So, the higher the ball is on the racket, the higher it will travel through the air, and vise-versa.

The ball will then take another 0.5 seconds to reach Riccardo, and if the ball is too high or too low, you win a round.

Win 3 rounds to complete the minigame.

If you want a visual example of how to (and also how not to because I suck at playing games) play the minigame, watch my demo playthrough: https://www.youtube.com/watch?v=vuofRxGcLXU

TL;DR: ball hit high, ball go high. ball hit low, ball go low.