Compressor settings for live music w/ a few sharp peaks

Most of the Audacity tools work on sound tips and peaks, so setting loudness (not directly related to peaks) can be a challenge.

You can try RMS Normalize. That one does directly affect loudness and follow that with Effect > Limiter with Soft Limit selected to tamp down extreme peaks like your example.

There are legacy broadcast processors that do those two jobs and did for a long time.

There is an all-in-one processor called Chris’s Compressor. He wrote it so he could listen to opera in the car without having to turn the volume up and down for the dramatic volume changes.