Just mouse-down on an item and move it. The file or folder level can also be changed this way. You can make folders from the menubar :File:New:Group".
I see that you are using folder references, not groups. If there is no specific reason to use folder references then change to use groups. When dragging in a folder of files there is the option of folder references or groups. Since folder references are a mirror of the directory structure and can not be changed in Xcode. I suspect the OP really wants groups.
When you are at the very bottom you can drag horizontally to select the level to move to. See added image.