Causes of detonation?

I also use 85-octane gas.

Oh yeah, I forgot to mention......you've gotta get some 92 octane. A cooler thermostat could help too.

I don't think I'm going to worry about headers now as I don't have the money for good ones. Besides I'll be giving up 10 HP at the most on this mild engine.

I seriously doubt that.....I'm thinking more like 35 or even 40 @ higher RPM's. Get some cheapies for now.