The most common and most likely answer to this crossword clue is the 5 letter word WATCH
I've seen this crossword clue in The Daily Telegraph
W
A
T
C
H
More clues leading to the result WATCH
- Keep an eye on hunter?
- Monitoring body observe and follow closely
- Pay attention to what the Spectator does
- Guard Nick gets a new top
- Stand guard over timer
- See what’s wrong when key is inserted
- Observe something on a limb?
- Keep an eye on wife at church
- See and set free what got caught in
- Discarded the top sample piece of cloth with the timepiece
Buddy explains!

The straight part
We know that "Observe" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case observe = watch.The cryptic/wordplay part
In cryptic crossword there's often an wordplay/cryptic part as well.This part involves a more complex hint, such as an anagram, homophone, hidden word, etc.
Sadly, We don't have an explanation for this specific crossword clue yet.
What does WATCH mean?
WATCH noun- A portable or wearable timepiece.
- The act of guarding and observing someone or something.
- A particular time period when guarding is kept.
- A person or group of people who guard.
- The post or office of a watchman; also, the place where a watchman is posted, or where a guard is kept.
- A group of sailors and officers aboard a ship or shore station with a common period of duty: starboard watch, port watch.
- A period of time on duty, usually four hours in length; the officers and crew who tend the working of a vessel during the same watch. (FM 55–501).
- The act of seeing, or viewing, for a period of time.
- To look at, see, or view for a period of time.
- To observe over a period of time; to notice or pay attention.
- To mind, attend, or guard.
- To be wary or cautious of.
- To attend to dangers to or regarding.
- To remain awake with a sick or dying person; to maintain a vigil.
- To be vigilant or on one's guard.
- To act as a lookout.
- (of a buoy) To serve the purpose of a watchman by floating properly in its place.
- To be awake.
- To be on the lookout for; to wait for expectantly.