How do I know whether what I want is what I am capable of?
Part One: Do I enjoy writing and telling stories? CHECK.
Part Two: Do my [beta] readers enjoy the stories?
If Part One and Two both agree, then you have something going on. But do choose your beta readers carefully. Some people will tell you what you want to hear except to be honest. Some people may be too brutal for you to hear the truth.
When I first started writing The Pacific Between, I didn't know if I would or could publish it. I just wanted to finish a novel, as a test for myself. That's PART ONE of my process. I found that I enjoyed it very much.
It wasn't until I let some trusted people and an editor read it that I accomplished PART TWO -- the moment of truth came when they told me they forgot to correct my mistakes because they were too into the story, that it read like something they might find in a store. That's why I realized I might really have something here.
A lot of PART TWO is based on other people's opinions, though. So do you trust these people's opinions? Are they objective enough to have any merits? Are you basing your entire self-worth as a writer on other people's opinions? Or do you really, deep inside yourself, know it is something you're both capable of and want to do?
Personally, I think you need both. If you only have part one, it's good enough to make yourself happy, to write what you want. There's nothing wrong with that. Many people write for pleasure and self-fulfillment. But if you want to be published, you have to accomplish Part two to some extent, because being published is about reaching readers, about communicating with someone who are not you, your family, or friends, but someone who may be willing to pay for your work.
Part one is about self-fulfillment. Part two is about honoring that writer-reader contract. (and they're not always mutually inclusive)