A cap is a move above the opponent's stone, usually at a distance of one space. It is a common move for reducing a framework or for attacking a weak group. It can be seen as the counterpart of the one point jump.
Here the cap reduces the moyo formed by the black stones. If Black were allowed to play at 1, his moyo would be perfected.
Here the cap blocks off White's natural escape to the center. The purpose can be twofold: make territory at the top while White is fleeing along dame points and/or create thickness towards the center.