Step 8 Select the type (Cmd/Ctrl + click on the layer icon). Now, using the Marquee tool (M), shift the selection down and left, as pictured. Carefully brush in hard-edged shadows on the ‘shadows_hard’ layer. These should be on areas where the type would cast shadows on itself. Set the layer’s blending mode to Multiply, at 50% opacity.
Step 9 Now create two clipping mask layers above the shadow layers and call them ‘light_overlay’ (blending mode set to Overlay) and ‘dark_overlay’ (set to Multiply). Use these layers to add light and dark shading to relevant areas.
Add another layer, making sure it’s not a clipping mask. Call it ‘highlights_dodge’ and set its blending mode to Color Dodge. Add light using a soft white brush to make the light areas glow softly.
Step 10 Add a 30% Gaussian Blur (Filter > Blur > Gaussian Blur) to the ‘type_vector’ layer. Using a soft black brush, mask out the blur, leaving just a few select edges blurred. This technique gives the type a more natural feel; I think it works better than having everything in sharp focus.