After you have adjusted your mesh lines, uncheck the Show Mesh box.
Create a new layer called Shadows. Select the black paint and the Airbrush tool.
If you pick presets, pick the large tool. It needs to be very soft and opacity on 1 to 3.

Look at the cloth and depending on your light source, paint in some 'valley' areas lightly.
In the layers palette, change blend mode to overlay.

Create another new layer for highlights. Use white paint on the 'hills' Repeat process. Change blend mode to overlay. Adjust opacity in the layers depending on your design. Don't overdo it.

Merge visible when you're finished. Save.