This is a slight restructuring which removes one of the HTTP calls (the null one) and moves the callback code within the addItem function, forming a closure.

gistfile1.js

function createObject() {
  var request_type;
	var browser = navigator.appName;
	if(browser == "Microsoft Internet Explorer"){
		request_type = new ActiveXObject("Microsoft.XMLHTTP");
	}
	else{
		request_type = new XMLHttpRequest();
	}
	return request_type;
}

// var httpAddItem = createObject();
// httpAddItem.open('get', 'nullPage.php');
// httpAddItem.send(null);


function addItem() {

	var httpAddItem = createObject();
	console.log(httpAddItem.readyState);
	var itemName = encodeURI(document.getElementById('itemNameInput').value);
	var itemDescription = encodeURI(document.getElementById('itemDescriptionInput').value);
	var itemPrice = encodeURI(document.getElementById('itemPriceInput').value);
	var itemQuantity = encodeURI(document.getElementById('itemQuantityInput').value);
	var itemImage = encodeURI(document.getElementById('fileInput').value);
	nocache = Math.random();
	
	httpAddItem.onreadystatechange = function () {
		//alert("yo");
		//alert(httpAddItem.readyState);
		//alert(httpAddItem.responseText);
		window.console.log(httpAddItem.readyState);
		if(httpAddItem.readyState == 4){ 	
			// else if login is ok show a message: "Site added+ site URL".
			var addNewItem= confirm("Do you want to add another item?");
	    	alert("yo");
		    if (addNewItem== true){
		        alert("hi");
		    }else{
		        alert("Meany!!!");
		    }
		}
		else{
			console.log("Loading");
		}
		window.console.log(httpAddItem.readyState);
	}

	httpAddItem.open('get', 'addItem.php?itemName='+itemName+'&itemDescription='+itemDescription+'&itemImage='+itemImage+'&itemPrice='+itemPrice+'&itemQuantity='+itemQuantity+'&nocache='+nocache, true);
	
	httpAddItem.send(null);
	
	//responseText = deleteItemhttp.responseText;
	
	
}