I just setup a new saltwater tank two weeks ago. I have 20lbs of live sand and 20lbs of live rock. I noticed today that the sand is clumping. Why could this be happening? Also i have seen no signs of ammonia yet, Why?

Add a couple of Damsel fish or Mollies (Satwater Adjusted) to your tank and your Ammonia level should begin to climb. Ammonia is generated when Protein is decomposed by Bacteria.

You have to wait for that live rock to go through a die off. Unless it had been fully cycled before. Unsure why the sand is clumping other than possibly a bacteria mass. I wouldnt add fish to the system, i dont like the thought of killing them if something goes wrong. Where'd you get the rock and sand and how long was it cycling before you got a hold of it?

I got the live rock from my lfs. It was fully cured and they told me I could put it right in tank the tank was setup a few days before I added it. I agree I don't wanna add fish untill I no it is alright.

I'd watch it for at least a week before adding anything yet. I did the same thing and it took a 1.5 weeks to get everything going. Just keep tabs on your parameters. You should see at least a small cycle.
After you know the cycle is done, add your cleaning crew. then your fish and some simple corals.

i just strated mine too...sand just started turning brown...i bought some hermet crabs and a peppermint shrimp...will they clean things up...i never built up any ammonia though.