Hebop7 you would normally use the Xfade button to do that, unfortunately this button is not available in playlist mode unless you have the lyrics screen open , and it is not available at all if you use an iPhone portrait mode unless you leave playlist mode and use the lyrics screen even though you need the playlist mode.
This is not ideal because its a very important function and i have pointed this out to Peter , unfortunately it is very hard to make this work right now due to technical reasons and i am sure it will probably be fixed in the upcoming versions of ST3.