We have witnessed the gold age (gen I) and the silver age (gen V) for psychic types. It's pretty obvious why gen I psychic types were so overpowered, so I won't discuss anything else. The "silver age" was due basically because gen V was fighting type's golden age. Dragons were overpowered and they needed someone to break their steel counters, and fighting types were even more efficient for that task than Magnezone. Moreover, the metagame was feeded with so many new and powerful fighting types (Conkeldurr, Mienshao, Keldeo, Terrakion, Scrafty, techniLoom) that the metagame was literally overpopulated with fighting types. In addition, many old psychic pokes recieved a powerful hidden ability (Slowbro, Alakazam, Xatu, Espeon), new pokes were added (Reuniclus, Sigilyph) and they get psyshock in order to pass through the blobs.
What has changed? Many things, but not the psychic pokes themselves. Dark and ghost attacks are simply everywhere, specially the overkilling knock off (probably the most gamebreaking attack since stealth rock). Fairy types, the phantom menace and talonflame have made fighting pokes much less common, thus reducing the niche of psychics as fighting counters. The balance should have been restored if poison types rised to counter the fairies, but that never happened, with only a new poison type introduced and only M-Venusaur raising with a new niche (Venusaur was an important mon in the previous generation with his growth sets under the sun). Toxicroak has vanished. Tentacruel is not common at all. Crobat has raised a little in usage, but he's still uncommon and can simply u-turn any psychic type facing him.
And what have they get to compensate? Almost nothing. Metagross recieved the coup de grace with two new weaknesses. Alakazam recieved a new mega with blazing speed and special attack... that cannot survive in the bulkier and priority infested metagame we have. The same goes for M-Medicham. Gardevoir recieved a huge plus with its new type, but for her psychic typing is simply a burden, making her neutral to dark and bug attacks, and weak to ghost. Defog has made Xatu's and Espeon role as hazard controller much less relevant. Deoxys recieved the "gift" of being weak enougth for OU (speed and defense forms). Reuniclus simply cannot survive the plethora of knock offs it has to face, and the main niche he still has are trick room gimmicks or anti stall capabilities. Slowbro recieved Assault Vest, wich is really amazing actually. And Latios never liked his type anyway...
There are many amazing pokes with psychic typing (in fact, there are way more viable ones than normal, rock or ice types, even in our metagame). It is an awful type, yes, but at least it doesn't have a ton of weaknesses, like rock or ice, and it has decent neutral coverage...
