Whatever works for you...

Being shy, I used to sing with my eyes closed all the time and only opened them when I had to play a lead. (I needed to see where my fingers were.)

I got over the 'nerves' thing by looking at something at the back of the room like a clock, beer pump, or Barmaid.

One critical word of advice. No matter how long you've been playing, or how many gigs you've done, you will sometimes see ONE person in the crowd with their arms crossed who is extremely unimpressed with your efforts.

Ignore them. If they were any good in the first place, you'd be sitting in the audience watching THEM.

Sing your head off and enjoy yourself.....