Is Water-type balanced or overpowered?
I have to admit, it's actually a bit overpowered. By itself, the Water-type is fairly balanced. In terms of movepools, Water-types get probably have some of the widest of any type when you consider that 90% of Water-types also learn Ice-type moves. When you throw in secondary types, the movepools grow even wider. So while movepools aren't necessarily everything in battling, they make a big difference. Because of this, it's actually possible to assemble a Water monotype team and have it be really well balanced.
I second this, I think Water-type is overpowered a well! They can learn either Ice Beam or Earthquake, certain kinds can learn Poison or Bug-type moves to counter their weakness as well as pumping up their usefulness as a support to their team members.
Stats wise, they are mostly balanced. We got Swampert, Suicune which both can act as a tank. Greninja is speedy and a strong Special moves users, its Hidden Ability Protean, can be nasty as it gains STAB for every offensive move. On the other hand, it fortunate that Greninja isn't bulky at the sametime, or it can be terrifying to battle one! Alomomola, while not strong on its offensive state, a battle with it can be devastating like the notorious SubSeeding technique from Grass-types, if used properly. Then we have Azumarill who keeps on getting better a Nichole once noted, those who are familiar with the competitive scene is no stranger with the innocent looking aqua bunny's devious moveset which can wreck a team.
Water-types are certainly fluid, depending on the species they can fit in a team for different role -- physical attacker, cleric, special attacker, tank, sponge etc. As
Quajutsu noted, it is possible to run a Water mono-type team. I haven't tried on the comopetitive area, but I believe they wouldn't do bad. Though I have tried once during one of my Gen III plays, there wasn't any difficulties.
