link exchange is the bets way to increase the traffic .while link exchanging depends on the quality of the back link of the other respective site means to increase the traffic in the eyes of the search engine. you can say it is also not the only way to increase the traffic and there are various way to increase it.
Hey Mate, As far as link exchange is concerned that You need to go through relevance link exchange strategy rather then with good page rank because if you go through high page rank website for link exchange even it's not concern with concept then may that back create your bounce rate, so please go through relevance website link exchange in this way, you will get good boost up in your search engine ranking position for your website.
Link exchange two types one is two way and another one is three way.so by doing link exchange to give your site good traffic.
you can exchange link with related site but if that site having high pr then that is more beneficial. Also, check your link for nofollow and after regular interval check the backlink status.
It is more useful to exchange link with same theme sites.if you exchange with other theme then may or may not helpful.
As other member told ya that i doesn't matter you link with your niche site or other but the matter is that it is good to have a link from your related website cuz google prefers that and give it a importance ... for example if you have 10 links from other website which do not have the matter related or same to your website = 1 link from a website who is totally related to your website .. One more thing it's is not difficult to get limk from your realted website .. there are many forums available you just tell ppls that you have a site of (blah blah blah) and you want to exchange your link with them they sure exchange thier website link with you because they also wants to get a link from a website who is related to thier
Exchanging links similar to your niche is always best and recommended by SEO's, it maximums your chance to get top SEPR in search engine like Google, Yahoo and Bing... it works like this, whenever a user search for a query based on your niche then, crawler fetch you links through site and shows in search results and if your content are relevant enough then your site can hit within top 10 search engine results. Yes, high PR link exchange also helps a lot, it lead your website to gain high PR, hence better chance to get nice SEPR...
You should forget about link exchanges as per the latest information from google, and instead focus on getting quality backlinks instead. http://www.im-wizard.com/why-you-should-stop-looking-for-link-exchanges/
Make sure you are doing link exchange with another website of related niche lest Google flags it as trying to fool the search engine.
Just understand, its some what related, then you should be fine. Keep a helpful reminder, to always check. If you spam, with google, it`ll catch up to you irregardless.