The angle of depression is the angle by which an observer must look down from his line of sight to see an object below him or her.
The angle of elevation is the angle by which an observer must look up from his line of sight to see an object above him or her.
Hence, angle 3 is an angle of elevation because it is the angle by which the observer must raise his/her head to see the top of the tree.
Therefore, angle 3 is an angle of elevation.