The most similar word to how fancy is used in this excerpt is <u>the second one</u>: <em>believe.</em>
Explanation:
The word <em>fancy</em> has more than one meaning, and we can realize which one is being used by reading the context and understanding the concept. In this excerpt given, the word <em>fancy</em> is used by the speaker as synonyms of <em>assumption, supposition, guess</em>. All of these are similar to <em>believe</em> and that is why I chose the second option.