Processes/Transforms involved to get brainwave data from raw EEG? (Autocorrelation confusion)
And the power spectral density is the Fourier transform of the autocorrelation.
I don't know about EEG data, but you can compute autocorrelation either in time domain or frequency domain. For instance if you need only a few samples of the autocorrelation it may be computed more efficiently using inner products than it would by $FFT^{-1}(|FFT(x)|^2)$. You know that the autocorrelation and the power spectral density are a time-frequency pair, so if the nature of information harmonic responses, oscillation modes, (power spectral density). But if the nature of the signal is chaotic with some dispersion (memory effect) you use the time domain (autocorrelation). autocorrelation are very good to analyze channel response in communication, and the signals in the brain are communication signals, so to me it makes sense to use that instead of frequency domain that could be used for identifying vibration in an engine for instance.