nginx + pm2 locations error

quite new to nginx and struggle to make the simplest thing running on digitalocean ubuntu 16.04 server. I have a node.js app running behind pm2 and this works fine with requests to mydomain.com:5002/endpoint. However, I can’t get it working on a separate location like /app, constantly getting 404. here’s the /etc/nginx/sites-available/default :

server {         listen 80 default_server;         listen [::]:80 default_server;          root /var/www/html;         server_name mydomain.com;         location /app/ {                 proxy_pass http://localhost:5002;         }          location / {                 # First attempt to serve request as file, then                 # as directory, then fall back to displaying a 404.                 try_files $  uri $  uri/ =404;         }            # pass the PHP scripts to FastCGI server listening on 127.0.0.1:9000         #         #       include snippets/fastcgi-php.conf;         #         #       # With php7.0-cgi alone:         #       fastcgi_pass 127.0.0.1:9000;         #       # With php7.0-fpm:         #       fastcgi_pass unix:/run/php/php7.0-fpm.sock;         #}          # deny access to .htaccess files, if Apache's document root         # concurs with nginx's one         #         #location ~ /\.ht {         #       deny all;         #} }