As Federal Reserve Chair Kevin Warsh prepares to deliver his main keynote address on Friday, market participants are bracing for potential turbulence, yet the odds suggest he may not offer the clarity investors are so eagerly awaiting.

Tom Essaye, founder of the research firm The Sevens Report, warns that if Warsh's remarks at Jackson Hole fail to unequivocally outline his stance on inflation and the projected path of interest rates, equities could suffer a notable pullback. Essaye further noted that persistently elevated long-term Treasury yields are already fueling anxiety over Fed policy.

"For the first time in over a decade, the picture is genuinely opaque for us. A significant part of the upward pressure on yields stems directly from this murky outlook on Fed actions. So, I believe Warsh needs to publicly deliver a firm statement on inflation while simultaneously signaling to the market that he has no intention of embarking on a sustained cycle of rate hikes," Essaye stated in a Wednesday interview with Yahoo Finance.

"If he can achieve that, and further clarify the specific indicators that will guide his rate decisions, only then might the market find a sense of relief," Essaye added.