situation vs nightmare

situation and nightmare both are nouns.

Word	Noun	Adjective	Verb	Adverb
situation	Yes	No	No	No
nightmare	Yes	No	No	No

As nouns, nightmare is a hyponym of situation; that is, nightmare is a word with a more specific, narrower meaning than situation:

situation (noun)	nightmare (noun)
a job in an organization	a terrifying or deeply upsetting dream
physical position in relation to the surroundings	a situation resembling a terrifying dream
the general state of things; the combination of circumstances at a given time
a condition or position in which you find yourself
a complex or critical or unusual difficulty