Why "What's up"?

Why's "what's up" used as greeting among young people? It sounds like asking "what is up there"?

A: What's up?

B: The sky.

Up has many, many uses and referring to something that is above is just one of them.

What’s up is not an innovation by the young of today. As a statement or a question about what might be happening, it isn't particularly new. In a letter written in 1838, the novelist Elizabeth Gaskell wrote I did not mention a word to Lucy but she must have guessed something was ‘up’. Even in its reduced form of wassup, it’s over 100 years old.

Just another idiom

What's up or wazzup

Etymology
Made popular by the cartoon character Bugs Bunny who used it as early as 1940 as part of his catch phrase “What’s up Doc?” (where each word was pronounced distinctly).

Alternative forms wassup, what up, waz up, wazzup, whassup, wuzzup, wussup, sup, wa'up, swa'up, what's good

Bugs Bunny

Budweiser commercial