Overheating

I have a 1998 jeep Cherokee limited. Several days ago I was
running errands an the temp gauge shot up 3 quarters of
the way to 260 an said check gauges..i let it cool off an
filled the reservoir and radiator with coolant. I didn't make it
a mile and a half an it shot up to 260 so I pulled over an
turned off the engine. I took the thermostat off and it was  
bone dry... bought a new one an replaced it...i didn't have it
tight at first because when I started the engine it was
squirting water out so I know the water pump works. I
adjusted the thermostats an made sure it was right. Good
deal. Drove home no problems. Ran errands the next 3 days
and no problems. Id periodically  check the water and the
radiator was full. Well today on my way to work as I was
pulling on the temp gauge shot up a notch below 260 an
said check gauges...as I slowed down an was pulling
around back the gauge started falling..at first I thought
maybe the sensor was bad but then it went back up. I
turned off the engine an checked under the hood and the  
reservoir is filled all the way to the top from overflow. Any
idea what my problem might be?