The reason for it is that when the thermostat is closed, the coolant circulating in the engine is warming up but the coolant in the radiator is cooling down. Once the engine coolant gets warm enough to open the thermostat, there is a large temperature difference. As the cooler antifreeze from the radiator enters the engine, you see your temperature gauge plummet until the thermostat closes again and the cycle repeats.
There are a few ways to deal with this. One is to run a winter front. If you don't tow heavy, you can run one in surprisingly warm weather. This keeps the temperature of the coolant in the radiator from dropping as much. Another way to solve it is to hook up to a big trailer but this isn't something that you can really control. The last thing that I am aware of is to strategically drill a few holes in the thermostat so that it is more sensitive. If you do a search, you can find a picture of where to do this.