How do I create a folder within a folder in the Favorites bar?

I want to set up my Favorites bar such that there are folders within folders.
I am using the Safari browser on a MacBook Air.

I can't seem to create it within the folder and I can't seem to be able to drag a folder into a folder.
Is there any way to achieve this?

I have a Lenovo laptop and I can just create folders within folders on the favorites bar in Windows.

Solution 1:

Open the sidebar - icon or Cmd ⌘ Shift ⇧ L .

Right click a current folder > New Folder.
New Folder will be created inside the existing one [at the bottom]. Rename as desired. Drag it to where you want it.

Close sidebar.
It will now appear in the favourites bar

You can actually add a new folder directly from the Bookmarks menu, but you still need to open the sidebar or Bookmarks editor to drag it into place.