Jeffe's post from Sunday was spot on about the marketing cycles and unpredictable sharp turns of mainstream publishing's trend-watchers.
No genre ever dies in self-publishing. It doesn't matter how sub or niche the genre, somebody is writing those stories. It's one of the joys of zero gatekeepers telling the market what they are and are not allowed to read.
Sure, even in self-publishing, the sales within popular genres will fluctuate with the trends. It's basic supply and demand. Whatever the "it" genre is will attract more authors to pump more books into the field, which leads to the issues of quality, quantity, and discoverability. If you're writing to a popular genre, prepare for an extreme emotional roller coaster. The competition for consumer dollars is fierce and it doesn't always translate to net revenue. The 1% who achieve anomalous success will face a backlash as the trend hits its apex. Self-published authors who are paying attention will know when the popularity bubble is readying to burst because their reviews and sales will show the indicators. (If the publishing houses were smart, they'd keep a closer eye on self-pub sales to detect the dying trends earlier as fair-weather readers tire of one trend and move on to the next "it" genre.)
If you're writing in an off-trend genre--a "dead" genre--you're more likely to have stable sales. That is not to say you'll ever have a predictable paycheck, especially in a creative field where having a "steady income" is like having a unicorn farm. But most readers who find your books are readers who are already committed fans of the genre. These readers are also more likely to stay with your series, post reviews, and virally market your books within their reader-community.
For the long game--for the career writers--writing to a "dead" genre is actually a great strategy to build a dedicated fan base that allows you some semblance of stability. The key word there is "build." No flashes in the pan. No get rich quick scheme. You are the ant, preparing for the seasonal fluctuations in sales. You'll know the highs, lows, and expectations of your genre's market. You'll become a bonafide member of the genre's community, tapped into all the benefits therein. Should the fickle tastes of consumers come 'round to elevating your genre to an "it" genre, you get to ride rising tide, enjoy the short-term boost, and then get back to normal.
Write the stories you want to write. Write them to the best of your ability. Sell them with an understanding and respect for your targeted audience.