The word describes the act of a vagina, or hoo hoo, hitting a person or object on a part of their anatomy or surface. It's very similar to the wordtea bagging in its usage.
"I want to get my hoo ditty doo pierced but I'm not too keen on the idea of dropping my draws and letting some strange guy stick a needle through my clit."
The phrase 'Hoo-dini' or 'Hoodini' quickly became a popular internet meme (showing up primarily in YouTube comment sections) when VanossGaming, a very well known gaming YouTuber, uploaded a video where he and some of his friends used a glitch in the video game Grand Theft Auto V to enter a comedy club. Once inside, the group began telling cheesy one-liners to each other. Vanoss, whose GTA character is known for wearing an owl mask, asked his friends, "What do you call a magic owl? HOO-DINI!" in reference to the sound an owl makes and the famous magician Harry Houdini. The joke itself wasn't funny, but instead how Vanoss said it. Nonetheless, the phrase caught on and appeared in the comment sections of many YouTubers such as Jacksfilms and Markiplier.
The set-up for most of these jokes include a short riddle, and the answer "HOO-DINI" even if "Hoodini" has nothing to do with the original riddle.