In "All valid data bits", what does "valid" refer to?

Question

Coding of NVB (Number of Valid Bits)

Length: 1 byte

The upper 4 bits are called “Byte count” and specify the integer part of the number of all valid data bits transmitted by the PCD (including SEL and NVB) divided by 8. Consequently, the minimum value of “Byte count” is 2 and the maximum value is 7.

What does the bold text mean?

1. Number of all the bits in a valid-data transmission?
2. Number of all the valid-bits in a data transmission?

I mean how can I understand what is the reference of valid (data or bits)?

Answer 1

In general, when you have a noun with a number of attributives (which may include nouns used attributively), the head noun is the last one in the construction, and all attributes refer to that head noun.

a yellow school bus

It is a bus we are talking about. It is yellow, and it goes to school. If there is such a thing as a yellow school, we would probably still not read this phrase as referring to a bus that goes to a yellow school.

If the attributes should refer to each other, we would have to make that clear by somehow connecting them. Sometimes we can leave out the space, sometimes we can use a hyphen. Compare these phrases:

a high school bus, a yellow school bus
a highschool bus, a yellow-school bus

The intuitive way of reading valid data bits is:

valid bits + data bits -> valid data bits.

If the author would mean:

valid data + data bits

He could opt for:

valid-data bits

or, and that would certainly avoid confusion:

bits of valid data

Answer 2

According to the paragraph title, it's the second one, the number of valid bits of data.