Final answer:
A teacher making rounds in the classroom and observing students reading is engaged in participant observation, which supports student comprehension and engagement.
Step-by-step explanation:
When a teacher is walking around the room and observing students as they read, this activity is considered a form of participant observation. This type of observation allows the teacher to immerse themselves in the classroom environment to make observations from an inside perspective, providing support to the classroom setting. It also helps students better understand the reading through informal analysis, encourages students to practice close reading in a comfortable way, and prepares them for writing formal essays by recording their initial impressions of the text.