The morning after Cathy gives Hareton the book, she and Heathcliff get into an argument at breakfast over her inheritance. Hareton takes her side. Heathcliff grabs Cathy and nearly hits her, but then suddenly lets her go—her eyes remind him of Catherine.
In the past, Heathcliff would have just hit Cathy, but his visions of Catherine are changing him, blunting his need for revenge.
That same night, he sees Cathy and Hareton sitting together, and they both remind him of Catherine. All of these reminders of Catherine torment him, and he admits to Nelly that he no longer much cares about taking out his revenge on Cathy and Hareton.
Being haunted by Catherine torments Heathcliff, but it is also what he always wanted., and so he no longer feels the need for vengeance, breaking the cycle of revenge and allowing Cathy and Hareton to live in peace.