Yes - the Spitfires were patrolling 10,000 ft above the German bombers, which likely inhibited the British pilots' ability to even spot the bombers.
AS directives are usually offensive sweep missions aimed at destroying enemy fighters. However, they can be effective as defensive combat air patrols if you are careful about the altitude setting. Since Axis bombers are generally going to fly at lower altitudes, AS directives intended as defense should probably be flown at 15,000 ft or less. Allied offensive AS directives involving high altitude fighters work best at 25,000 ft or higher, drawing intercepting Axis fighters above their best altitude.
If you have enough available air directives and want to thoroughly defend some piece of airspace, such as over an invasion beachhead, you might want consider multiple AS directives: low altitude fighters (Spitfire LF IX, Spitfire XII, or even P-38) at 10,000 ft to catch Axis fighter bombers and high altitude fighters at 15-20,000 ft to catch Axis fighters trying to impose their own AS directive.