A Link Wheel is basically the same as a link chain.
For a long time people used closed link wheels. In the example above we can see an open link wheel. However, if this link were to be closed the web 2.0 site on the left would link to the forum on the right effectively closing off the link wheel (and making it look spoked on a wheel).
Google can spot these closed link wheels easily and will penalise your site if you do this. So, don’t do it!
In our above example we can see 1 tier 2 link wheel sending link juice to a tier 1 site.
In reality you can have as many link wheels as you want as long as you do not close them.
When you build lots of link wheels and deep tiered pyramids for 1 main money site it is ofetn referred to as a mini net.
You can take this as deep as you like by building link wheels to each site within its own link wheel.
Obviously this can be become a complicated affair and extremely time-consuming even when using automated software so it is always best to have a full plan of how many wheels you will build and how deep you intend to go before you embark on the link building tasks.