Level 4 is located, from your starting point where you got the wooden sword:

Up 1 screen
Left 2 screens
Up 1 screen
Push up while you're standing on the dock on the water and you'll use the raft that you found in level 3 to get to the 4th level. (If you didn't get the raft in level 3, now's the time to go back for it...)

Here's an overworld map, if you're interested:

http://db.gamefaqs.com/console/nes/...a_overworld.gif