The Federal Reserve's decision on tapering — whether large, small or not at all — is bound to spark a stock market selloff because Wall Street has such a wide gulf of expectations of what the Fed is going to do, predicts MSN Money columnist Anthony Mirhaydari.

The uncertainty means the only prudent course of action is to take profits before the Fed's Sept. 18 announcement, he said.

"With expectations all over the map, the Fed has done a terrible job of managing sentiment heading into its announcement. That raises the risk of a negative market reaction that could rattle confidence and short-circuit the improvement we've seen."

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Mirhaydari, owner of Mirhaydari Capital Management, noted that recent conflicting economic data, such as strong purchasing manager reports followed by weak payroll and home sales, only amplifies the confusion.

"The basic idea is that improving data will lead to tapering, while weak data will not — which in a sense makes bad news good on Wall Street and good news bad."

Mirhaydari said the most likely outcome of the Fed meeting is a $10 billion taper of the Fed's $85 billion monthly bond purchases with an extension of "forward guidance," which tries to keep short-term interest rates low while long-term bond purchases are cut back.

According to his thinking, "the Fed is dancing with the devil of inflation by promising to keep money too cheap for too long."

Mirhaydari's prediction is that no matter how the Fed tiptoes through the tapering minefield "disappointment is bound to follow – either now on a harder-than-expected taper or in the future, when inflation kicks up and the Fed has no choice but to tighten short-term rates faster than the market expects."

"Given the uncertainty heading into Sept. 18, I'm recommending that trade-minded readers and clients take profits early next week, raise some cash and seek to insulate themselves from the volatility that'll surely surround the Fed's taper decision."

Ned Rumpeltin, head of G10 FX strategy at Standard Chartered Bank, told Reuters, "The Fed is still likely to taper next week or in October, but the trajectory of the tapering that we had assumed can no longer be taken for granted."

A Reuters poll of economists this week found most believe the Fed will taper by about $10 billion, down from $15 billion in an earlier poll.

A Bloomberg News survey of economists also came up with a consensus of economists for a $10 billion taper.

"You've recovered most of the correction we saw in August, so now investors are going to be more sensitive to missteps by the administration, Congress and the Fed in these developments over the coming weeks," Phil Orlando, New York-based chief equity strategist at Federated Investors, told Bloomberg.