Sounds to me like you need to pull your upper timing cover off and verify that the timing is correct (between crank and cams), that there are no missing teeth on the timing belt, and that there is no excessive slack in the timing belt as well. What's happening with your car sounds EXACTLY like what my former 87 Turbo was doing when the timing was slipping. That can also explain why the ignition timing reads incorrectly
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1989 7MGTE R154 Targa Top White Package w/Blue Interior
Driftmotion 57trim CT26, Upgraded Intercooler, 2.25" Hard Pipes, 3" Turbo Back Exhaust with Test Pipe, HKS VPC w/GM 3 bar MAP sensor, APEXi S-AFC, Walbro 255lph fuel pump, ProSport EVO Series Boost / Fuel Pressure / AFR gauges, Lotek a Pillar Gauge Pod, HKS Type 0 Turbo Timer, Eibach Lowering Springs, Tokico Illumina II TEMS struts, custom powder coated Motegi Racing TrakLite wheels
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