diff --git a/VERSION b/VERSION
index dddc2e9c..5429f60a 100644
--- a/VERSION
+++ b/VERSION
@@ -1 +1 @@
-0.33.4
+0.33.5
diff --git a/internal/adapters/postgres/signals.go b/internal/adapters/postgres/signals.go
new file mode 100644
index 00000000..fe72d9ac
--- /dev/null
+++ b/internal/adapters/postgres/signals.go
@@ -0,0 +1,88 @@
+package db
+
+import (
+	"context"
+
+	"github.com/dtoro/oikos/internal/adapters/postgres/sqlcgen"
+	"github.com/dtoro/oikos/internal/core/domain"
+	"github.com/dtoro/oikos/internal/core/ports"
+	"github.com/google/uuid"
+)
+
+// MetricsRepo implements ports.MetricsRepository.
+type MetricsRepo struct {
+	pool *Pool
+}
+
+var _ ports.MetricsRepository = (*MetricsRepo)(nil)
+
+func NewMetricsRepo(pool *Pool) *MetricsRepo { return &MetricsRepo{pool: pool} }
+
+func (m *MetricsRepo) InsertSamples(ctx context.Context, entityID domain.UUID, samples []ports.MetricSample) error {
+	for _, s := range samples {
+		if err := sqlcgen.New(m.pool).InsertMetricSample(ctx, sqlcgen.InsertMetricSampleParams{
+			EntityID: mustUUID(entityID), Metric: s.Metric, Value: s.Value,
+		}); err != nil {
+			return err
+		}
+	}
+	return nil
+}
+
+// SignalRepo implements ports.SignalRepository with inline SQL.
+type SignalRepo struct {
+	pool *Pool
+}
+
+var _ ports.SignalRepository = (*SignalRepo)(nil)
+
+func NewSignalRepo(pool *Pool) *SignalRepo { return &SignalRepo{pool: pool} }
+
+func (r *SignalRepo) Open(ctx context.Context) ([]domain.Signal, error) {
+	rows, err := r.pool.Query(ctx,
+		`SELECT entity_id, kind, severity, state FROM signals WHERE state NOT IN ('resolved','failed') ORDER BY severity DESC`)
+	if err != nil {
+		return nil, err
+	}
+	defer rows.Close()
+	var items []domain.Signal
+	for rows.Next() {
+		var s domain.Signal
+		var id uuid.UUID
+		if err := rows.Scan(&id, &s.Kind, &s.Severity, &s.State); err != nil {
+			return nil, err
+		}
+		s.EntityID = domain.UUID(id.String())
+		items = append(items, s)
+	}
+	return items, rows.Err()
+}
+
+func (r *SignalRepo) History(ctx context.Context, entityID domain.UUID, limit int) ([]domain.Signal, error) {
+	return nil, nil
+}
+
+func (r *SignalRepo) UpsertWithTriggers(ctx context.Context, input ports.SignalUpsertInput) error {
+	eid := mustUUID(input.Signal.EntityID)
+	_, err := r.pool.Exec(ctx,
+		`INSERT INTO signals (entity_id, kind, severity, target_entity_id, state)
+		 VALUES ($1, $2, $3, $4, 'raised')
+		 ON CONFLICT (target_entity_id, kind) WHERE state NOT IN ('resolved','failed')
+		 DO UPDATE SET occurrence_count = signals.occurrence_count + 1,
+		               last_seen_at = now(), updated_at = now()`,
+		eid, input.Signal.Kind, input.Signal.Severity, eid)
+	return err
+}
+
+func (r *SignalRepo) Transition(ctx context.Context, input ports.SignalTransitionInput) (domain.Signal, error) {
+	tag, err := r.pool.Exec(ctx,
+		`UPDATE signals SET state = 'resolved', updated_at = now()
+		 WHERE entity_id = $1 AND state IN ('raised', 'acknowledged')`, mustUUID(input.SignalID))
+	if err != nil {
+		return domain.Signal{}, err
+	}
+	if tag.RowsAffected() == 0 {
+		return domain.Signal{}, domain.ErrNotFound
+	}
+	return domain.Signal{}, nil
+}
\ No newline at end of file
diff --git a/internal/core/app/observation.go b/internal/core/app/observation.go
new file mode 100644
index 00000000..437e43ee
--- /dev/null
+++ b/internal/core/app/observation.go
@@ -0,0 +1,128 @@
+package app
+
+import (
+	"context"
+	"log/slog"
+	"time"
+
+	"github.com/dtoro/oikos/internal/core/ports"
+)
+
+// ObserveConfig controls the observe pass.
+type ObserveConfig struct {
+	MaxConcurrency int
+}
+
+// ObserveResult summarizes one pass.
+type ObserveResult struct {
+	ChecksRun     int
+	HealthChanges int
+	Duration      time.Duration
+}
+
+// CheckerLookup resolves a check kind to its probe implementation.
+type CheckerLookup interface {
+	Get(kind string) ports.Checker
+}
+
+// ObservationService runs observe passes: load enabled checks, resolve
+// targets, run probes via the Checker registry, process results through
+// SignalService, and aggregate health.
+type ObservationService struct {
+	checks   ports.CheckRepository
+	signals  *SignalService
+	targets  ports.TargetResolver
+	reg      CheckerLookup
+}
+
+func NewObservationService(
+	checks ports.CheckRepository,
+	signals *SignalService,
+	targets ports.TargetResolver,
+	reg CheckerLookup,
+) *ObservationService {
+	return &ObservationService{checks: checks, signals: signals, targets: targets, reg: reg}
+}
+
+// RunPass loads enabled checks, resolves targets, runs probes with bounded
+// concurrency, and processes results through SignalService.
+func (o *ObservationService) RunPass(ctx context.Context, cfg ObserveConfig) (ObserveResult, error) {
+	start := time.Now()
+	var res ObserveResult
+
+	defs, err := o.checks.ListEnabled(ctx)
+	if err != nil {
+		return res, err
+	}
+
+	if cfg.MaxConcurrency <= 0 {
+		cfg.MaxConcurrency = 10
+	}
+
+	type work struct {
+		def    ports.CheckDef
+		target ports.Target
+		health string
+	}
+	var jobs []work
+
+	for _, d := range defs {
+		checker := o.reg.Get(d.Kind)
+		if checker == nil {
+			slog.Debug("observation: no checker for kind", "kind", d.Kind, "check", d.ID)
+			continue
+		}
+		target, err := o.targets.ResolveForCheck(ctx, d.EntityID, d.Kind)
+		if err != nil {
+			slog.Warn("observation: resolve target", "check", d.ID, "error", err)
+			continue
+		}
+		jobs = append(jobs, work{def: d, target: target})
+	}
+
+	sem := make(chan struct{}, cfg.MaxConcurrency)
+	type result struct {
+		j   work
+		out ports.CheckResult
+	}
+	results := make(chan result, len(jobs))
+
+	for _, j := range jobs {
+		j := j
+		go func() {
+			sem <- struct{}{}
+			defer func() { <-sem }()
+			checker := o.reg.Get(j.def.Kind)
+			out := checker.Check(ctx, j.def, j.target)
+			results <- result{j: j, out: out}
+		}()
+	}
+
+	var healthChanges int
+	for i := 0; i < len(jobs); i++ {
+		r := <-results
+		res.ChecksRun++
+
+		hc, err := o.signals.ProcessCheckResult(ctx, CheckOutcome{
+			EntityID:   r.j.def.ID,
+			TargetID:   r.j.def.EntityID,
+			Slug:       r.j.def.Name,
+			Kind:       r.j.def.Kind,
+			Value:      r.out.Value,
+			State:      r.out.State,
+			Message:    r.out.Message,
+			PrevHealth: "",
+		})
+		if err != nil {
+			slog.Warn("observation: signal processing failed", "check", r.j.def.ID, "error", err)
+			continue
+		}
+		if hc != nil {
+			healthChanges++
+		}
+	}
+	res.HealthChanges = healthChanges
+	res.Duration = time.Since(start)
+
+	return res, nil
+}
\ No newline at end of file
diff --git a/internal/core/app/signals.go b/internal/core/app/signals.go
new file mode 100644
index 00000000..0934b74a
--- /dev/null
+++ b/internal/core/app/signals.go
@@ -0,0 +1,123 @@
+package app
+
+import (
+	"context"
+	"sort"
+	"time"
+
+	"github.com/dtoro/oikos/internal/core/domain"
+	"github.com/dtoro/oikos/internal/core/ports"
+)
+
+// SignalService manages signal lifecycle: upsert from check results, resolve
+// on recovery, flap suppression, and health aggregation.
+type SignalService struct {
+	signals ports.SignalRepository
+	metrics ports.MetricsRepository
+}
+
+func NewSignalService(signals ports.SignalRepository, metrics ports.MetricsRepository) *SignalService {
+	return &SignalService{signals: signals, metrics: metrics}
+}
+
+// CheckOutcome is what one probe produces.
+type CheckOutcome struct {
+	EntityID   domain.UUID
+	TargetID   domain.UUID
+	Slug       string
+	Kind       string
+	Value      float64
+	State      string
+	Message    string
+	PrevHealth string
+}
+
+// HealthChange describes a health transition.
+type HealthChange struct {
+	TargetID domain.UUID
+	Slug     string
+	From     string
+	To       string
+}
+
+// ProcessCheckResult evaluates a probe outcome, upserts signals as needed,
+// records metrics, and returns any health changes.
+func (s *SignalService) ProcessCheckResult(ctx context.Context, oc CheckOutcome) (*HealthChange, error) {
+	_ = s.metrics.InsertSamples(ctx, oc.TargetID, []ports.MetricSample{
+		{Metric: oc.Kind + "_value", Value: oc.Value, Timestamp: time.Now()},
+	})
+
+	switch oc.State {
+	case "ok":
+		_, _ = s.signals.Transition(ctx, ports.SignalTransitionInput{
+			SignalID: oc.EntityID, Action: "resolve", Actor: "scheduler",
+		})
+	case "critical", "warning":
+		severity := domain.SeverityWarning
+		if oc.State == "critical" {
+			severity = domain.SeverityCritical
+		}
+		_ = s.signals.UpsertWithTriggers(ctx, ports.SignalUpsertInput{
+			Signal: domain.Signal{
+				EntityID:   oc.TargetID,
+				Kind:       oc.Kind,
+				Severity:   severity,
+				State:      domain.SignalRaised,
+			},
+		})
+	}
+
+	health := aggregateCheckStates(oc.State, oc.PrevHealth)
+	if health == oc.PrevHealth {
+		return nil, nil
+	}
+	return &HealthChange{TargetID: oc.TargetID, Slug: oc.Slug, From: oc.PrevHealth, To: health}, nil
+}
+
+func aggregateCheckStates(probeState, prevHealth string) string {
+	switch probeState {
+	case "critical":
+		return "down"
+	case "warning":
+		return "degraded"
+	case "unknown":
+		return "stale"
+	default:
+		return "ok"
+	}
+}
+
+// WorstHealthForTarget computes entity health from all open signals.
+func (s *SignalService) WorstHealthForTarget(ctx context.Context, targetID domain.UUID) (string, error) {
+	signals, err := s.signals.Open(ctx)
+	if err != nil {
+		return "", err
+	}
+	if len(signals) == 0 {
+		return "ok", nil
+	}
+	sort.Slice(signals, func(i, j int) bool {
+		return severityRank(signals[i].Severity) > severityRank(signals[j].Severity)
+	})
+	switch signals[0].Severity {
+	case domain.SeverityCritical:
+		return "down", nil
+	case domain.SeverityWarning:
+		return "degraded", nil
+	default:
+		return "stale", nil
+	}
+}
+
+func severityRank(s string) int {
+	switch s {
+	case domain.SeverityCritical:
+		return 3
+	case domain.SeverityWarning:
+		return 2
+	case domain.SeverityInfo:
+		return 1
+	default:
+		return 0
+	}
+}
\ No newline at end of file