Research in Motion (RIMM, $97.84, down $5.60) fell back below $100 on Monday ahead of its scheduled earnings report on Thursday. The stock has been making $10 swings almost on a daily basis which leads me to believe the stock will make a substantial move by the end of the week.

There are some analysts who expect RIMM to post solid quarterly results, with revenues of $2.6 billion and earnings-per-share of $0.87. Although early October’s availability of the company’s 3G Bold and Kickstart have acted as a near-term catalyst, there’s a report out that says RIMM’s September sell-through numbers are looking “slightly disappointing” ahead of the new product launches. This was on top of a “flat” August.

There are too many variables to consider a trade for RIMM, especially with earnings coming out. To me, it is looking as though RIMM’s new products are going to have a bigger impact on the company’s next quarter, not this one.

Worldwide smartphone sales grew nearly 16% in Q2 from a year earlier and smartphones control about 11% of the mobile device market. That’s good news for RIMM because it shows there is still plenty of market share to capture. However, with so many competitors coming into the fray, RIMM will be fighting for that market share with the likes of Apple (AAPL, $131.05, down $9.86) and even Google (GOOG, $430.14, down $19.01).

The stock hit a low of $88 on September 18 which tested multi-year support. I profiled a RIMM strangle option trade earlier this month that netted us a 35%-40% profit. I would almost go out on a limb and recommend the same trade but it’s just too risky. The recent low has me leaning towards RIMM testing those lows again but a good earnings report may help the shares from sinking.

Rick Rouse
Rick@OptionsMentoring.com

As we head to lunch, here’s some tidbits on some of the stocks we are currently following.

On September 2, I did a piece on McDonald’s (MCD, $63.88, up $1.46) saying the company would be reporting great same-store sales. At the time, the stock had lost its hype because the Olympics had finished and Wall Street grew bored with the stock. It was a great time to go long some calls options and that we did. Although these calls doubled shortly after I mentioned them, then traded lower, today is another payday. Same-store sales rose 8% in August.

The September 65 calls (MCDIM, $0.65, up $0.30) are up 86% this morning and could have been bought for 40 cents on 9/2. The October 65 calls (MCDJM, $1.65, up $0.45) are up 38% and were going for $1.25. This is the second time the market is begging you to take profits so manage your positions accordingly.

Research in Motion (RIMM, $104.27, up $1.60) has rebounded nicely and has traded as high as $106 today. Apple (AAPL, $158.40, up $0.48) is introducing new and cheaper iPods in a couple of hours.

Lehman Brothers (LEH, $10.18, down $3.97) hit a low of $8 earlier in the session after buyout talks with the Korea Development Bank have ended. I’ve been hesitant to make an option trade on Lehman but a strangle is looking more and more like a possibility. If you want to pull the trigger on one here is the play. The October 12.50 calls (LYHJV, $2.41, down $1.44) and the October 7.50 puts (LYHVU, $2.34, up $1.55) look like the perfect fit. As sure as the sun will come up tomorrow, you can almost bet Lehman is going to move $5 in either direction by October, if not within the next day or two.

The DryShips (DRYS, $53.30, down $4.12) October 60 puts (DQRVL, $9.70, up $3.20) continue to soar. If you recall, we did a strangle trade on DryShips on August 25. We sold the calls shortly after the trade and the puts were trading for $2.60 at the time. They have more than tripled and are working on a “quad”. As you can see, some of the strangle trades we have been using are providing us with monster returns.

Rick Rouse
Rick@OptionsMentoring.com

Talk about fireworks. Google (GOOG, $465.25, up $1.96) came out like a rocket this morning after the debut of its Internet Chrome browser only to fizzle at the end. The stock was up 19 and change to $482 within the first 30 minutes of trading and briefly traded below Friday’s closing price of $463.29 before finishing the session slightly higher.

The four-year development of Chrome finally came to fruition today as the company takes direct aim at Microsoft’s (MSFT, $27.10, down $0.19) Internet Explorer. Folks, it doesn’t get any bigger than this. Simply put, the risk and rewards are that great for Google.

Microsoft currently controls a little over 70% of the Internet browser market. Mozilla’s Firefox and Apple’s (AAPL, $166.19, down $3.34) Safari fight for the rest of the market share which are the only real two competitors Microsoft has. Until now.

Of course Google claims Chrome is simplier and faster and is not only trying to get you to use it but to sign up for new services. The web based service market is expected to grow big-time by 2011 and Google wants in. And here’s a little gas for the fire. Eric Schmidt, who is Google’s CEO, once worked for Novell (NOVL, $6.40, down $0.03) and Sun Microsystems (JAVA, $9.00, unchanged). He was in charge of Java, Sun’s platform-independent programming technology, which never had much success taking on Microsoft. So the two companies he has worked for have been thwarted by Microsoft in the past. You get the picture (sly grin).

I’m not sure how successful Chrome will be and only time will tell if this will be a major victory for Google or another side distraction. The euphoria sure wore off as the day progressed. Once again, this is why “most” of the time you shouldn’t buy options at the open. (I say “most” of the time because I did profile some McDonald’s call options this morning). The Google September 500 calls (GOPIO, $3.70, up $0.40) opened at $6.00 this morning and traded as high as $7.00 before closing substanially lower. Imagine buying into the hype at $7.00 only to lose 50% of your cash by the end of the trading day.

Meanwhile, if you had bought the Google September 450 puts (GOPUJ, $8.50, down $0.37) shortly after the market opened, you could have bought these puts at $4.00 or $5.00 and doubled your money by the end of the day. Oops. I just told you how Wall Street works again. Shame on me. But seriously, both of these trades were risky and this is how a lot of individual investors lose their money and get frustrated with options.

Google has basically been below $500 a share since it disappointed Wall Street with its earnings back in July. The stock had a nice run in mid-August to $510 but is still trading below all of it major moving averages (i.e, 20, 50, 100 and 200-day). It shows the market is being risk-adverse when it comes to Google. There will be a time when the stars are aligned just right for us to go long or short Google but right now is not that time.

Rick Rouse
Rick@OptionsMentoring.com

Eaton (ETN, $96.68, up $2.42) continues to roll. The stock gained another 2.5% today and is up nearly $8 for the week. I had mentioned the activity building in the June 95 calls (ETNFS, $3.40, up $1.30) when they were trading for $1.80. Trading volume was strong and the stock made higher highs throughout the week. This sets up well for next week as Eaton continues its assualt on $100. If Eaton can get to $100 then the June 95 calls will be worth at least $5.00.

Apple (AAPL, $188.75, up $2.06) traded higher every day this week ahead of its June 9 release of the 3G iPhone launch next month. Although the impact won’t be seen in its upcoming quarter many expect Apple will crush their estimated 10 million iPhone target well before the end of the year.

Options traders are targeting the June 200 calls (APVFT, $2.91, up $0.16) and the longer-term July 200 calls (APVGT, $6.85, up $0.35).

Before closing, I also wanted to mention the American Society of Clinical Oncology’s (ASCO) annual meeting which is being held over the weekend. Imclone (IMCL, $43.58, up $0.58) and Bristol-Myers Squibb (BMY, $22.79 up $0.31) could see some action come Monday. The companies are expected to give an update on Erbitux that could help lift these stocks higher. Imclone saw plenty of action today in the June 45 calls (QCIFI, $1.55, Up $0.28) as 11,000 contracts traded hands. The July 50 calls (QCIGJ, $0.80, up $0.10) aslo experienced some brisk trading as over 2,000 contracts traded hands.

I’ll give you an update on Monday.

Rick Rouse
Rick@OptionsMentoring.com

Apple’s (AAPL, $189.96, up $1.80) knocking on the $200 door and some key events will determine whether Apple kicks in the door or goes away quietly again. Last time Apple tested $200 it was Christmas and the company was still riding the success of its iPhone debut as well as the holiday shopping season. It was all downhill after that when Apple announced earnings in January and lowered expectations for its coming quarter. The stock reached a low of $120 in late February and early March.

However, this was an important level of “support” and the stock has done nothing but gain 70 points in two months since then. Yeah, for those who thought Apple was going to be swallowed by the bears, those same bears have been covering their short positions like crazy over the past few months.

I believe the key to whether Apple stays above or below $200 will depend on what the company says and does at its annual Worldwide Developers Conference that starts June 9. Will Apple make a “surprise” announcement about an existing product or the possibility of a new one?

People “in the know” say Apple plans to begin selling its next-generation iPhone handset sometime on or after the third week of June. The new version of the iPhone will be compatible with 3G (third-generation) networks.

The other big news rumored to be is that Apple could be ready to enter the gaming business (to a degree). Word is the company has filed patents and is testing a “3D remote control system” for its Apple TV set-top box. It would be a knock-off of Nintendo’s Wii controller and would also have multi-touch technology.

Some of you have emailed me asking about the May 200 (APVET, $0.25, unchanged) and the June 200 (APVFT, $5.25, unchanged) call options. My advice is that you are playing with fire on the May 200 calls and we all know what can happen when you play with fire. The May calls are cheap but Apple would have to be at $200.25 by Friday for you to break even. With the June 200 calls, you’re still playing with fire but you can always get out if the stock fades at $200. You still might get burned just not as bad.

I can’t see a “gaming product” being launched at the conference but I can see the announcement of the updated iPhone unfolding. That and some news on iMacs and Apple’s operating software could help the stock “break on through to the other side”…

Rick Rouse
Rick@OptionsMentoring.com

Research in Motion (RIMM, $141.69, up $8.92) is having a stellar day, hitting an all-time high of $143 earlier in the session. The company unveiled its latest BlackBerry model dubbed, the Bold, which was its first major new model in over a year. The phone is expected to compete directly with Apple’s (AAPL, $188.16, up $4.71) iPhone.

RIMM’s Bold has twice the screen resolution of the company’s current Curve BlackBerry and dual-band Wi-Fi and GPS capabilities should be available from carriers this summer. The May call options have been active in RIMM. The May 140 calls (RULEH, $4.07, up $3.30) have traded over 30,000 contracts and are up 428%, and the May 145 calls (RULEI, $1.77, up $1.52) are up 600% as over 20,000 contracts have traded hands.

The announcement of the Bold came earlier than expected and on the heels of Apple’s news that its online stores in the U.S. and U.K. are sold out of the iPhone. Some stores run by Apple and AT&T (T, $39.11, up $0.52) may still have units available but it’s hit or miss.

The low availability of the iPhones could indicate that the release of a 3G iPhone is just around the corner. Apple has a conference that starts June 9 and we all know Steve Jobs likes to make a splash at such events. Apple sold 1.7 million iPhones in its last quarter and its goal is to sell 10 million iPhones by year-end. Many analysts believe they will easily beat that number.

The release of a new iPhone would help offset sales that Apple is losing now as people anxiously await its release. All three companies (Apple, AT&T, and RIMM) have positioned themselves ahead of the competition and now its up to the rest of them to play catch-up.

Rick Rouse
Rick@OptionsMentoring.com

There’s quite a few big-time names reporting today and you can expect they will have an impact on the market.

Amazon.com, (AMZN, $79.60, down $0.58). After beating estimates for a few quarters on its way to $100 a share, Amazon could face an uphill battle if earnings are only in-line.

Anheuser-Busch Companies (BUD, $47.40, down $0.77). The King of Beers could disappoint Wall Street as profits might come up short with rising commodity costs. What’s good for Potash is bad for Anheuser-Bush as the price of corn and other commodities used to make beer have just exploded over the past 12 months.

Apple (APPL, $160.20, down $7.96). By far, Apple will be the most closely watched stock. Look for stronger Mac sales and a drop in iPods sold. Of course, Apple is famous for pulling a rabbit out of the hat so anything is possible here.

Chipotle (CMG, $113.15, down $5.13). The burrito chain could either surprise Wall Street or say that rising food costs or other factors had an affect on their bottom line. It’s a coin-flip.

Delta Air Lines (DAL, $6.80, down $1.40). If it couldn’t get any worse, Delta drops 17% the day before it reports earnings. And get this, it could cost us more to fly in the future…one Airline CEO recently stated that they would have to up prices 15%-20% just to break even!

F5 Networks (FFIV, $21.31, down $0.62). This once high-flier is challenging its 52-week low of $17.70 after trading to a 52-week high of $46.94.

Philip Morris International (PM, $50.07, down $0.56). Barron’s likes the U.S. tobacco stocks.

Qualcomm (QCOM, $41.55, down $1.07). Does anyone remember the analyst who gave the stock a $1,000 price target back in 1999? Was it Prince? No, it was actually a broker at PaineWebber.

United Parcel Service (UPS, $71.90, down $0.62). What can Brown do for Wall Street is the big question today.

Rick Rouse
Rick@OptionsMentoring.com