Water temp. sensor or temp. gauge, which one is it?

[Tomas7]

On my 76 280C, the temp needle fluctuates, from the midway mark down to about an eighth of an inch below that.
Sometimes even more. It seems that in the freeway it goes a little above the midway mark. I thought that on the freeway it should drive cooler.
Is my water temp sensor taking a dump or is it my gauge?
The car has new thermostat and new water pump and new coolant. Clutch fan was replaced about two months ago.

Thanks in advance