Previous bias shift approaches to predicate invention are not applicable to learning from positive examples only, if a complete hypothesis can be found in the given language, as negative examples are required to determine whether new predicates should be invented or not. One approach to this problem is presented, MERLIN 2.0, which is a successor of a system in which predicate invention is guided by sequences of input clauses in SLD-refutations of positive and negative examples w.r.t. an overly general theory. In contrast to its predecessor which searches for the minimal nite-state automaton that can generate all positive and no negative sequences, MERLIN 2.0 uses a technique for inducing Hidden Markov Models from positive sequences only. This enables the system to invent new predicates without being triggered by negative examples. Another advantage of using this induction technique is that it allows for incremental learning. Experimental results are presented comparing MERLIN 2.0 with ...