Adelaide have come hardest for Bailey, offering a monster seven-year, $10 million deal to secure the in-demand free agent.
The Lions recently matched the length of that proposal, but the Crows are still offering significantly more money over the entire contract.
Asked about Bailey's future almost weekly, Fagan provided a more positive update than he has all year on the 26-year-old.
"I feel optimistic about Zac," Fagan told reporters on Thursday.
"I don't know why I do, but I do.
"I know he loves being here, so (I'm) optimistic."
While Bailey might stay, dual Brownlow medallist Lachie Neale is almost certain to leave after a tumultuous period in his personal life.
Neale is considering offers from multiple clubs, recently meeting with St Kilda and Essendon.
Collingwood were the first Victorian outfit to express interest in Neale, after the prevailing thought was he would move to Western Australia if he left Brisbane.
Neale's estranged wife Jules moved to Perth with the couple's two children when their marriage broke down late last year.
Fagan confessed he was "sick of talking" about the futures of Neale and Bailey.
"I'm just their coach and I only care about the here and now, both from a performance perspective and how they're going as people," he said.
"That's where I tend to focus my energy and I'm hopeful both those boys will stay.
"It's hard to give a running commentary and there's always lots of people who think they know what's going on."
Massive favourites for Sunday's match against Essendon at the Gabba, the fourth-placed Lions will regain Hugh McCluggage (calf) and veteran Dayne Zorko (quad) from injury.
All-Australian last year, McCluggage has battled injury multiple times this season and been well off his best form during the nine games he has played.
"His body is feeling better now than he has all year," Fagan said of McCluggage.
"I'm hopeful that we can see the best of him for the rest of the season."
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