That's part of the PCM programming. It dynamically adjusts the spark (ignition) timing based off load and RPMs. You could have 35* of spark timing cruising on the highway, or 11* at full throttle. Sometimes the tables in the PCM take the timing too far and it causes predetonation to occur. The only way to stop it is to pull the timing back to a safer level, and that's what the knock sensors help to do.
There's nothing wrong with it causing it to not hold timing. This is how it's supposed to operate as it provides the most HP and the most MPG out of the same package. But for this cycle to work you need the knock sensors to provide the PCM feedback on if it has to pull timing to save the engine.
