When using various link exchanges to improve your link popularity, you always need to reciprocate. According to many SEO gurus, linking to sites without relevance can actually damage your own search engine rankings, but if done correctly, the gain is much higher than the potential downside.
Link popularity is important to gain higher rankings in almost every major search engine. But, according to a popular theory, only links from relevant pages count, others wont improve your SERPs. But, many websites have a variety of areas, topics and pages, making most links relevant for at least something.
For any spider, determining exactly what every page and website is about, is a tedious task. With no human reviewers the search engines rely solely on their algorithms to calculate the results for any query, tweaking it more and more to better the results. But, the spiders have little or no way of knowing what the page is about, it can only count words and phrases. A webpage containing many words relevant to your site will make a good inbound link regardless of the actual content. What people see as relevant differs widely from what the search engines consider relevant, because of the major differences in how we measure the relevance. A human being can easily see synonyms, abbreviations and typos, which spiders still have troubles with.
While all algorithms used to calculate SE positions are unique and very complex, the basic idea is much the same for all. The search engines are always trying to figure out how to calculate links, keyword density, anchor text and much more, to more accurately show results relevant to any particular query. They tweak it to make it harder for dubious SEO techniques to be successful, but most important is the over all accuracy of results for any given search. This is what the makes or breaks a SE, bad results will make any search engine loose all its users.
Most SEs are mildly positive to some sort of SEO, but most frown upon non-generic links and try to limit the importance of links acquired only to gain link popularity.
Figuring out what links are natural and not is hard enough for a human being, and even harder for any spider, but some things tend to be very obvious;
Excessive, non-categorized link pages
Just making one link page after another, adding any and all links will make it easier to spot links on your page NOT to serve your users, but only to reciprocate. An easy way of avoiding this is to categorize your link pages better. There is lots of free directory software available online, make use of it.
To narrow linking strategy
Only using link exchanges to gain inbound links will make it very obvious. All links will be reciprocated, often from pages with low relevance. On top of this, many other websites will have the exact same inbound links as you, making it even more obvious. Find other ways of gaining inbound links, if you find it to time consuming, see to it you get at least a few one-way links, just to spice it up.
Not enough variation of anchor text
The ability of getting many backlinks fast can make any webmaster forget the importance of altering your anchor text and web site description. No site with generic links has one anchor text 95% of the time. If you do, you are bound to get noticed. Make sure you change your anchor text often, use as many variations possible, but be sure to use the most important words in as many phrases you can without overdoing it.
To many links in a short period of time
Getting a crazy amount of links in no time is a certain way of attracting unwanted attention. Make sure you try to increase your backlinks slowly, to increase the daily amount of new links over time. This is the most probable way of a site gaining real links, make your to imitate it the best you can.
Taking these things in consideration when using reciprocal linking will make it much more effective, and much less likely to get penalized.
http://www.articleco.com/Article/The-hazards-of-reciprocal-linking---Common-pitfalls-and-ways-of-avoiding-them/26936
