The 3rd letter is the key here.
If you are going to look up a possible word that a user is typing, iOS waits until the third letter typed to do the lookup. Too many possibilities before then. So at the third letter typed, in the video it displayed the U, but his finger was low on the button. It displayed, then did the lookup, and while it was doing that lookup the u was still displayed, but the input moved to J without the display being updated. Maybe the lookup being spawned on the background thread caused enough delay on the main thread to not update the highlighted key before the touchUp event fired?