Jakin, over at SBC Witness, explains in his article Reading the Bible Christocentrically,

Interpreting OT history is often a confusing task for the church. How do you apply Israelite history to the modern church? There have been two dominant attempts to resolve this tension: allegory and historical-grammatical method. Allegory arose mainly with people who deeply believed the OT was of value to the church and about Christ, so they struggled to read it as Christian scripture. Their difficulty over the literal sense of the text led to an allegorical, spiritual interpretation of the text that sought to raise the literal sense to a higher plane. Historical-grammatical method deeply values the literal sense of the text, employing a kind of scientific method to read the text and find out what it meant in its own time. Neither adequately accounts for the complete message of the Bible as a work about Christ. A Christocentric hermeneutic should be used instead of allegory or just historical-grammatical method.

Both the allegorical approach and the historical-grammatical method generate similar outcomes for the application of OT history. An allegorical approach basically de-historicizes the OT. On the other hand, the historical-grammatical approach can cancel out the OT as Christian scripture because its history meant something to Israel at the time, but it is difficult to see how it applies today. Those who subscribe to this kind of method usually only see application as learning from history so you do not repeat it...

He later concludes,

There has always been a struggle in applying OT history to the church. Allegory cancels out history in favor of spiritual reading of the text. Historical-grammatical method analyzes what the text meant, but ends up with moralism as the only way to apply the text, which puts the scripture on same level as Aesop's fables. None of these methods adequately accounts for Jesus' claims that the OT was about him (John 5:39). If one accepts that God works in types in history, and those patterns are fulfilled ultimately in Christ, and then are mediated to those in Him, then one can seek to identify those patterns today and apply the living word of Israelite history to the modern church.

Check out his article Reading the Bible Christocentrically