Oceanid is an elite boss that's located in between Mondstadt and Liyue region. You can get the map to show the location by switching your adventure handbook to Liyue region in the Bosses tab.
How to fight
To fight the boss, go to the arena-like area, and walk over to the blue highlighted area, but before you start the fight, it is highly recommended that you bring a ranged unit to deal with certain enemies later. In order to defeat the boss, you will have to keep defeating the water illusions. You won't really be attacking the big water creature itself.
Oceanid will start summoning enemies once the fight starts, and there are several different types of enemies that she can summon. She will only summon more, when the current enemies on the field are defeated. If you take too long to the enemies, then she will start to deal some massive damage to you with some water explosion.
It is highly recommended that you bring at least 1 ranged character, ideally a damage dealer as well. Lisa and Amber can be a decent option that everyone has since they are free characters. Also bring a healer like Barbara, Qiqi, or even Noelle since some of their attacks can be somewhat difficult to avoid.
Since the summons are purely Hydro element, you're going to want to bring an elemental attacker that's good against them like Pyro, or Electro. Pyro damage will deal an extra 50% more damage because of "vaporize" elemental reaction, and Electro can deal electro-charged damage over time, but this can end up damaging you as well since the entire area is water.
Ningguang is a very good option for the fight since she is a ranged damage dealer that attacks with a Geo element, causing crystalize and gives you a water shield when picked up, but her wall won't work properly because of the area. You can do it with Noelle too if you just want the defensive effect.
Cryo element helps quite a lot by freezing enemies so you won't get overwhelmed by relentless attacks. If you attack with a claymore user, you can do additional damage too.
A powerful force has started to converge...
Oceanid will deal massive hydro damage that appears below you, most likely going to kill your on field character. This happens whenever you take too long to fight the enemies per wave, and it resets whenever you defeat each wave of enemies. You are able to switch out to a different character when you start to see the message, or when the water starts to appear below your character. No known ways to avoid it yet if it happens, but you can try to dodge parts of the attack by using an elemental burst.
Oceanid will summon water creatures to fight, and there are many different versions of them. They all only have about 1 or 2 different attacks each, and can sometimes be summoned in variation. The boars and squirrels can also recover some health if you take too long.
Jump and slams the ground to deal AoE damage. Will also explode when defeated, in a VERY wide area. You can dodge the explosion by running very far away from it, or use characters like Venti to fly up, or Geo main character to create a rock and climb up.
Summons 3 flying birds to chase you around and will charge at you when they get too close. This is the main enemy that you are going to want to bring your ranged characters for. You can try it with melee characters, but if you take too long, then Oceanid will just attack you from afar and kill off your on field character.
Has an area of effect surrounding it, dealing constant damage over time, and can also do a melee attack when they get too close.
2 boars with a fairly telegraphed attack by charging at you. They are the easiest to deal with since they don't constantly chase you around, and will mostly only attack after they turn to your direction.
Crabs will rotate around you and constantly throws out bubble attacks dealing considerable damage. This attack can be quite difficult to get away from since they don't have much of a downtime between attacks. It's best to try and get rid of it as quickly as you can.
Squirrels can do a vertical and horizontal swipes with a wide area. They will also keep chasing after you. Can be somewhat difficult to dodge, so try to practice your invulnerability frames when you dodge.
These are the ranged enemies since they can attack you from afar by using some water shockwaves. The projectiles don't move around once fired, so it's easy to avoid. They will jump back when you get too close, you might have an easier time taking them down with a ranged character.
The frog can do a ranged projectile attack, or a jump and dive attack, similar to both crane and big bird's attack. Sounds like a problem, but luckily they only spawn 1 at a time compared to the other summons. Will also explode and deal damage in a very wide area after defeated.