Sure sounds like thermostat ...

Maybe Collapsed lower hose?

Try simple things first, bleeding the air from the system. 

Thermostat may be sticking, head gasket may be seeping compression into the cooling system, specially if it's puking Dexcool out the overflow. It may be something as simple as the gauge or sending unit. Get it to a dealer and get it checked out. Still under warranty?? 2004.5-2005 trucks had some problems with overheating. You may ask around over here....  http://www.dieselplace.com/forum/index.php

How do you do this? It started happening after the cap was removed and put back on.

A buddy of mine had this verything happen with his '06. We were out of town and thought that it was just the thermostat. Turned out it was the head gasket. Not sure what he paid to have it fixed.

Be sure that cap is screwed down tight... I topped off all my fluids this afternoon and that screw on cap on the coolant recovery bottle is hard to turn.... For those that don't know, the coolant recovery bottle is pressurized on these trucks and acts as a coolant reservoir. That's probably the power steering/transmission noise that you think you're hearing... It's the pressure escaping from the recovery bottle... Maybe.

The cap is on tight....48,000 miles, I hope this isn't major.

The top radiator hose is not hard, no coolant in oil, no film on tailpipe, no collapsed hoses. We are going to start with the thermostats.

Good Job!  Thanks for sharing the solution.

I deleted my posts above cause I thought you had it.  I had my fingers x'd for you.

Now for the sad news.  You most likely have blown your Head Gaskets.  Very common and if in warranty your all set.  If you do determine HGs and it is warranty or not make sure you stud it with ARP studs.  Your dealer will add them for you as long as you provide them.

Check out the Diesel forms for your truck, talk to a respectable Dealer.  Have some tests run and see where it goes.

I am holding out for 2012 model lines.  That will be one year after all manufactures are forced to have changed their engines due to the stricter emissions required in 2011.  The Ford is being brought back in house and is looking good.  But Ford is adding DEF (Diesel Exhaust Fluid) to reduce the nitrogen oxide levels.  My issue is its a separate tank that needs to be filled.  Not sure what the costs are going to be and how available it will be.  But I am diggin all the other options and specs published so far.

It is the LLY.......ARP studs make that much of a difference? I'll look into it, thanks.

Now the diesel forum won't acknowledge my email.....grrrr

That's the thing with buying a used truck, specially a diesel.... No telling how hard it's been hot rodded before you got it. I kinda thought it was a head gasket all along, with expanding gasses pushing coolant out the overflow. Don't hear of many Duramax's with blown head gaskets. 6.0 Powerstrokes are more common with this ailment.

Bummer, Well I didn't learn more about diesels than my Dealers mechanic because I wanted too.  Dam joke what you can end up with and not even know it.  Rentento is square on. 

Next time I by new :)

So here goes the song and dance I have to give you.  HGs blew for a reason.  In my Ford It was mostly related to the oil cooler (location and size)  but what people don't realize the failure of the oil cooler is due to a secret that Ford will never divulge.  Casting Sand!  No matter how many oil coolers you replace you will never fix the problem until you install a coolant filter system.  Darn casting sand leaches from the block for the life (a short one) of the truck.  I am not familiar with why your model line blows HGs but you should try to figure it out.  Otherwise the issue will return.  The Studs are an added security blanket when driving those head temps up on steep climbs.

I recommend some type of monitoring system.  Get away from the dummy needles.  I went low tech with a ScanGauge II unit (Love it)

Don't idle the new Diesels for more time than to bring up the oil pressure. It will ruin your EGR valve and clog your emissions.  Always remeber anything emissions is a separate warranty which is fairly extensive beyond all other warranties (federal Gov stuff)

I noticed your miles are low.  Lean over and I will wisper one more seceret in your ear.

After your HGs are done call GMC and tell them very seriously the following phrase:

"I have lost confidence in your product"

With the proper use of the phrase and persistance you may get lucky and be offered cost on a new vehical or the GMC extended warranty for no cost.

Trust me you will want it.

Good Luck!