^
Even the most high-end streaming machines can't do 1080p120fps in good quality with a reasonable bitrate. And your CPU is only mid-end. If you really need 1080p, you can try 1080p30fps at a bitrate of 2500kbps. Otherwise you can use a 2000kbps bitrate and downscale to 720p30fps, or even 540p30fps. Whether you want to downscale the whole stream or just one source in your scene depends on how your scene is setup. If you want my recommendation please post a screenshot of your scenes setup with preview running.
Also, make sure to use 64bit OBS. It will run more efficiently on a 64bit OS.
As for CPU issues: The CPU preset determines how much CPU your OBS will use. If you still have spare CPU, you should try a slower one, and if you experience lag in your game while streaming, you should use a faster one. Setting the process priority of your game to "high" in the task manager or the in-game settings can help with lag too.