diff --git a/rag/rag-springai-ollama-llm/pom.xml b/rag/rag-springai-ollama-llm/pom.xml
index 3fd60de..1730d20 100644
--- a/rag/rag-springai-ollama-llm/pom.xml
+++ b/rag/rag-springai-ollama-llm/pom.xml
@@ -5,7 +5,7 @@
     <parent>
         <groupId>org.springframework.boot</groupId>
         <artifactId>spring-boot-starter-parent</artifactId>
-        <version>3.3.6</version>
+        <version>3.4.1</version>
         <relativePath/> <!-- lookup parent from repository -->
     </parent>
     <groupId>com.learning.ai</groupId>
@@ -16,7 +16,8 @@
 
     <properties>
         <java.version>21</java.version>
-        <spring-ai.version>1.0.0-M4</spring-ai.version>
+        <spring-ai.version>1.0.0-M5</spring-ai.version>
+        <otelInstrumentation.version>2.10.0-alpha</otelInstrumentation.version>
         <spotless.version>2.43.0</spotless.version>
     </properties>
 
@@ -39,11 +40,7 @@
         </dependency>
         <dependency>
             <groupId>org.springframework.ai</groupId>
-            <artifactId>spring-ai-redis-store-spring-boot-starter</artifactId>
-        </dependency>
-        <dependency>
-            <groupId>org.apache.commons</groupId>
-            <artifactId>commons-pool2</artifactId>
+            <artifactId>spring-ai-pgvector-store-spring-boot-starter</artifactId>
         </dependency>
         <dependency>
             <groupId>org.springframework.ai</groupId>
@@ -56,7 +53,14 @@
         <dependency>
             <groupId>org.springdoc</groupId>
             <artifactId>springdoc-openapi-starter-webmvc-ui</artifactId>
-            <version>2.6.0</version>
+            <version>2.7.0</version>
+        </dependency>
+
+        <dependency>
+            <groupId>org.springframework.boot</groupId>
+            <artifactId>spring-boot-devtools</artifactId>
+            <scope>runtime</scope>
+            <optional>true</optional>
         </dependency>
 
         <dependency>
@@ -76,6 +80,17 @@
             <groupId>io.micrometer</groupId>
             <artifactId>micrometer-registry-otlp</artifactId>
         </dependency>
+        <dependency>
+            <groupId>net.ttddyy.observation</groupId>
+            <artifactId>datasource-micrometer-spring-boot</artifactId>
+            <version>1.0.6</version>
+        </dependency>
+        <dependency>
+            <groupId>io.opentelemetry.instrumentation</groupId>
+            <artifactId>opentelemetry-logback-appender-1.0</artifactId>
+            <scope>runtime</scope>
+        </dependency>
+
         <dependency>
             <groupId>org.springframework.boot</groupId>
             <artifactId>spring-boot-starter-test</artifactId>
@@ -97,16 +112,14 @@
             <scope>test</scope>
         </dependency>
         <dependency>
-            <groupId>com.redis.testcontainers</groupId>
-            <artifactId>testcontainers-redis</artifactId>
+            <groupId>org.testcontainers</groupId>
+            <artifactId>grafana</artifactId>
             <scope>test</scope>
-            <version>1.6.4</version>
         </dependency>
         <dependency>
             <groupId>org.testcontainers</groupId>
-            <artifactId>grafana</artifactId>
+            <artifactId>postgresql</artifactId>
             <scope>test</scope>
-            <version>1.20.4</version>
         </dependency>
         <dependency>
             <groupId>io.rest-assured</groupId>
@@ -124,6 +137,13 @@
                 <type>pom</type>
                 <scope>import</scope>
             </dependency>
+            <dependency>
+                <groupId>io.opentelemetry.instrumentation</groupId>
+                <artifactId>opentelemetry-instrumentation-bom-alpha</artifactId>
+                <version>${otelInstrumentation.version}</version>
+                <type>pom</type>
+                <scope>import</scope>
+            </dependency>
         </dependencies>
     </dependencyManagement>
 
@@ -144,7 +164,7 @@
                 <configuration>
                     <java>
                         <palantirJavaFormat>
-                            <version>2.47.0</version>
+                            <version>2.50.0</version>
                         </palantirJavaFormat>
                         <importOrder/>
                         <removeUnusedImports/>
diff --git a/rag/rag-springai-ollama-llm/src/main/java/com/learning/ai/llmragwithspringai/config/RestClientBuilderConfig.java b/rag/rag-springai-ollama-llm/src/main/java/com/learning/ai/llmragwithspringai/config/RestClientBuilderConfig.java
deleted file mode 100644
index 8adbc8d..0000000
--- a/rag/rag-springai-ollama-llm/src/main/java/com/learning/ai/llmragwithspringai/config/RestClientBuilderConfig.java
+++ /dev/null
@@ -1,20 +0,0 @@
-package com.learning.ai.llmragwithspringai.config;
-
-import java.time.Duration;
-import org.springframework.boot.web.client.ClientHttpRequestFactories;
-import org.springframework.boot.web.client.ClientHttpRequestFactorySettings;
-import org.springframework.boot.web.client.RestClientCustomizer;
-import org.springframework.context.annotation.Bean;
-import org.springframework.context.annotation.Configuration;
-
-@Configuration(proxyBeanMethods = false)
-public class RestClientBuilderConfig {
-
-    @Bean
-    RestClientCustomizer restClientCustomizer() {
-        return restClientBuilder -> restClientBuilder.requestFactory(
-                ClientHttpRequestFactories.get(ClientHttpRequestFactorySettings.DEFAULTS
-                        .withConnectTimeout(Duration.ofSeconds(60))
-                        .withReadTimeout(Duration.ofMinutes(5))));
-    }
-}
diff --git a/rag/rag-springai-ollama-llm/src/main/java/com/learning/ai/llmragwithspringai/service/AIChatService.java b/rag/rag-springai-ollama-llm/src/main/java/com/learning/ai/llmragwithspringai/service/AIChatService.java
index 481e7b0..addb5a4 100644
--- a/rag/rag-springai-ollama-llm/src/main/java/com/learning/ai/llmragwithspringai/service/AIChatService.java
+++ b/rag/rag-springai-ollama-llm/src/main/java/com/learning/ai/llmragwithspringai/service/AIChatService.java
@@ -3,10 +3,10 @@
 import org.slf4j.Logger;
 import org.slf4j.LoggerFactory;
 import org.springframework.ai.chat.client.ChatClient;
-import org.springframework.ai.chat.client.advisor.QuestionAnswerAdvisor;
-import org.springframework.ai.chat.model.ChatResponse;
-import org.springframework.ai.chat.model.Generation;
-import org.springframework.ai.vectorstore.SearchRequest;
+import org.springframework.ai.chat.client.advisor.RetrievalAugmentationAdvisor;
+import org.springframework.ai.chat.prompt.AssistantPromptTemplate;
+import org.springframework.ai.rag.generation.augmentation.ContextualQueryAugmenter;
+import org.springframework.ai.rag.retrieval.search.VectorStoreDocumentRetriever;
 import org.springframework.ai.vectorstore.VectorStore;
 import org.springframework.stereotype.Service;
 
@@ -22,26 +22,35 @@ public class AIChatService {
             isn't found in the DOCUMENTS section, simply state that you don't know the answer.
 
             DOCUMENTS:
-            {question_answer_context}
+            {query}
 
             """;
 
     private final ChatClient aiClient;
-    private final VectorStore vectorStore;
 
     public AIChatService(ChatClient.Builder builder, VectorStore vectorStore) {
-        this.aiClient = builder.build();
-        this.vectorStore = vectorStore;
+
+        var documentRetriever = VectorStoreDocumentRetriever.builder()
+                .vectorStore(vectorStore)
+                .similarityThreshold(0.50)
+                .build();
+
+        var queryAugmenter = ContextualQueryAugmenter.builder()
+                .promptTemplate(new AssistantPromptTemplate(template))
+                .allowEmptyContext(true)
+                .build();
+
+        RetrievalAugmentationAdvisor retrievalAugmentationAdvisor = RetrievalAugmentationAdvisor.builder()
+                .documentRetriever(documentRetriever)
+                .queryAugmenter(queryAugmenter)
+                .build();
+        this.aiClient =
+                builder.clone().defaultAdvisors(retrievalAugmentationAdvisor).build();
     }
 
     public String chat(String query) {
-        ChatResponse aiResponse = aiClient.prompt()
-                .advisors(new QuestionAnswerAdvisor(vectorStore, SearchRequest.query(query), template))
-                .user(query)
-                .call()
-                .chatResponse();
+        String aiResponse = aiClient.prompt().user(query).call().content();
         LOGGER.info("Response received from call :{}", aiResponse);
-        Generation generation = aiResponse.getResult();
-        return (generation != null) ? generation.getOutput().getContent() : "";
+        return aiResponse;
     }
 }
diff --git a/rag/rag-springai-ollama-llm/src/main/resources/application.properties b/rag/rag-springai-ollama-llm/src/main/resources/application.properties
index 6a0724c..75eda33 100644
--- a/rag/rag-springai-ollama-llm/src/main/resources/application.properties
+++ b/rag/rag-springai-ollama-llm/src/main/resources/application.properties
@@ -3,6 +3,7 @@ spring.application.name=rag-springai-ollama-llm
 spring.threads.virtual.enabled=true
 spring.mvc.problemdetails.enabled=true
 
+spring.ai.ollama.init.pull-model-strategy=when_missing
 spring.ai.ollama.chat.options.model=mistral
 spring.ai.ollama.chat.options.temperature=0.3
 spring.ai.ollama.chat.options.top-k=2
@@ -10,19 +11,28 @@ spring.ai.ollama.chat.options.top-p=0.2
 
 spring.ai.ollama.embedding.options.model=nomic-embed-text
 
-spring.ai.vectorstore.redis.index=vector_store
-spring.ai.vectorstore.redis.prefix=ai
-spring.ai.vectorstore.redis.initialize-schema=true
+#PgVector
+spring.ai.vectorstore.observations.include-query-response=true
+spring.ai.vectorstore.pgvector.initialize-schema=true
 
-spring.ai.ollama.baseUrl=http://localhost:11434
+spring.http.client.connect-timeout=PT1M
+spring.http.client.read-timeout=PT5M
 
 spring.testcontainers.beans.startup=parallel
 
 ##Observability
 spring.ai.chat.observations.include-completion=true
 spring.ai.chat.observations.include-prompt=true
+spring.ai.chat.client.observations.include-input=true
 
 management.endpoints.web.exposure.include=*
 management.metrics.tags.service.name=${spring.application.name}
 management.tracing.sampling.probability=1.0
 management.otlp.tracing.endpoint=http://localhost:4318/v1/traces
+management.otlp.logging.endpoint=http://localhost:4318/v1/logs
+
+logging.level.org.springframework.ai.rag=debug
+
+## only for development
+spring.ai.vectorstore.pgvector.removeExistingVectorStoreTable=true
+spring.ai.ollama.baseUrl=http://localhost:11434
diff --git a/rag/rag-springai-ollama-llm/src/main/resources/logback-spring.xml b/rag/rag-springai-ollama-llm/src/main/resources/logback-spring.xml
new file mode 100644
index 0000000..1e2ef31
--- /dev/null
+++ b/rag/rag-springai-ollama-llm/src/main/resources/logback-spring.xml
@@ -0,0 +1,16 @@
+<?xml version="1.0" encoding="UTF-8"?>
+<configuration>
+    <include resource="org/springframework/boot/logging/logback/base.xml" />
+
+    <appender name="OpenTelemetry"
+              class="io.opentelemetry.instrumentation.logback.appender.v1_0.OpenTelemetryAppender">
+        <captureExperimentalAttributes>true</captureExperimentalAttributes>
+        <captureCodeAttributes>true</captureCodeAttributes>
+        <captureKeyValuePairAttributes>true</captureKeyValuePairAttributes>
+    </appender>
+
+    <root level="INFO">
+        <appender-ref ref="OpenTelemetry"/>
+    </root>
+
+</configuration>
diff --git a/rag/rag-springai-ollama-llm/src/test/java/com/learning/ai/llmragwithspringai/config/TestcontainersConfiguration.java b/rag/rag-springai-ollama-llm/src/test/java/com/learning/ai/llmragwithspringai/config/TestcontainersConfiguration.java
index 4c7deda..b718825 100644
--- a/rag/rag-springai-ollama-llm/src/test/java/com/learning/ai/llmragwithspringai/config/TestcontainersConfiguration.java
+++ b/rag/rag-springai-ollama-llm/src/test/java/com/learning/ai/llmragwithspringai/config/TestcontainersConfiguration.java
@@ -1,13 +1,11 @@
 package com.learning.ai.llmragwithspringai.config;
 
-import com.redis.testcontainers.RedisStackContainer;
 import java.io.IOException;
 import java.time.Duration;
 import org.springframework.boot.test.context.TestConfiguration;
 import org.springframework.boot.testcontainers.service.connection.ServiceConnection;
 import org.springframework.context.annotation.Bean;
-import org.springframework.context.annotation.Scope;
-import org.springframework.test.context.DynamicPropertyRegistry;
+import org.testcontainers.containers.PostgreSQLContainer;
 import org.testcontainers.grafana.LgtmStackContainer;
 import org.testcontainers.ollama.OllamaContainer;
 import org.testcontainers.utility.DockerImageName;
@@ -28,19 +26,15 @@ OllamaContainer ollama() throws IOException, InterruptedException {
     }
 
     @Bean
-    RedisStackContainer redisContainer(DynamicPropertyRegistry properties) {
-        RedisStackContainer redis = new RedisStackContainer(
-                RedisStackContainer.DEFAULT_IMAGE_NAME.withTag(RedisStackContainer.DEFAULT_TAG));
-        properties.add("spring.ai.vectorstore.redis.uri", () -> "redis://%s:%d"
-                .formatted(redis.getHost(), redis.getMappedPort(6379)));
-        return redis;
+    @ServiceConnection
+    PostgreSQLContainer<?> postgreSQLContainer() {
+        return new PostgreSQLContainer<>(DockerImageName.parse("pgvector/pgvector:pg17"));
     }
 
     @Bean
-    @Scope("singleton")
-    @ServiceConnection("otel/opentelemetry-collector-contrib")
+    @ServiceConnection
     LgtmStackContainer lgtmStackContainer() {
-        return new LgtmStackContainer(DockerImageName.parse("grafana/otel-lgtm").withTag("0.7.1"))
+        return new LgtmStackContainer(DockerImageName.parse("grafana/otel-lgtm").withTag("0.8.1"))
                 .withStartupTimeout(Duration.ofMinutes(2));
     }
 }