Oh. Seems someone did HAM-6 Kefratraz Bars before I did it in:
http://ada.untergrund.net/showdemo.php?demoid=518
Heres how I did it:
1) Set modulo to -40 so that the top line is stretched across the whole screen
2) Set up a copper list that starts the blitter to copy your 1-pixel high graphics into the bitplanes on every rasterline
3) Put the CPU into a loop that changes the blitter parameters so that the graphic is drawn in a sine-wave
On the screenshot you refer to, i'd imagine the text is sprites.