Here, by his native stream, at such an hour, Pity's own Otway I methinks could meet, And hear his deep sighs swell the sadden'd wind!
Our speaker imagines meeting a guy named Otway who used to live around here—she says that the Arun River was "his native stream."
Historical Context Note! Otway refers to one Thomas Otway, an English poet and playwright from the late 1600s who was famous for writing emotions in a believable way—something that a sentimental poet like Charlotte Smith could appreciate. She was a big Otway fan and seems to have been proud to come from the same part of England as Otway. Unfortunately for Otway, though, he died in poverty… and according to one story, he died choking on a piece of bread that someone gave him out of charity! (Check out the "Best of the Web" section for links to more info on Otway.)
Okay, back to the poem. Now that you know something about Otway, it'll make sense that the speaker says that he is "Pity's own Otway," as though "Pity" somehow owns him.
And no wonder she imagines that Otway would be sighing—he had a lot to sigh about, poor guy!
Something weird is going on in line 11—the wind doesn't feel anything, so to say that it's sad must be personification.
O Melancholy!—such thy magic power, That to the soul these dreams are often sweet, And soothe the pensive visionary mind!
The speaker addresses melancholy directly here. When a poet speaks directly to something that can't answer (like a tree, or a bird, or a mood), it's called apostrophe.
Interesting. She doesn't say that melancholy is a bad mood to be in. She says that it's actually kind of magical. So the spookiness that was building earlier on in the poem actually turns out to be "magical." Huh. Maybe seeing ghosts in the mist isn't such a bad thing.
Somehow, feeling melancholy actually soothes her. This seems like it's contradictory, and may be almost a paradox. How can being melancholy actually feel good?
The last six lines of the poem (called a sestet) follow the rhyme scheme of CDECDE. Hey! This is typical of a Petrarchan sonnet—go check out "Form and Meter" for more!