Heat will continue to rise. So that heated air is just building up at the top of the incubator until it's enough to hit where the probe is centered.
You can try moving the probe to the top of the incubator instead, so when the air up top hits the desired temp, it turns off. Obviously, this can leave the lower part of the incubator a bit colder. A simple computer style fan can help keep the air moving and get that heat a little more evenly spread.
If the temp is still hitting 104 up top when you move the probe there, you probably have a busted thermostat or probe.