When we read a narrative from the Old Testament, we want to honour it as God’s word written, and yet we may be unsure how to do so.  So we end up – all too often – mistreating and misapplying it in one or more of the following ways:-

1. Allegorizing.  We neglect the shape of the story itself, and discover (or rather, invent) meanings that seem more relevant and more spiritual.  Graeme Goldsworthy writes of the way in which the five stones that David used to kill Goliath are identified as ‘obedience’, ‘service’, ‘Bible reading’, prayer’, and ‘fellowship’ (Gospel and Kingdom, p10)!
2. Decontextualizing.  We ignore where the story sits in the flow of God’s redemptive purposes.
3. Selectivity.  We pick and chose which words and phrases we want to focus on, neglecting the shape of the story as a whole.  Thus, Jesus’ words, “The Lord needs it” (Lk 19:34) might become an appeal to give money to the church.
4. False combination.  We combine two or more elements from the story and make a connection between them that was never part of the original intention of the story-teller.  For example, we might conclude from Psa 23 that our real enemies are within the church because David says that God has prepared him a table in the presence of his enemies.
5. Redefinition.  We ‘tweak’ the details of the story in an attempt to force them into a meaning that seems more relevant or helpful to ourselves.  So, when Jesus says, “Woe to you who are rich…” (Lk 6:24), we reinterpret this as, “Woe to those who are richer than us…”.
6. Extracanonical authority.  We use some external source – such as set of idiosyncratic doctrines – as a key to ‘unlock the code’ that we imagine the story contains.  Cults do this all the time.  But orthodox Christians too should beware of imposing their creed on the biblical text.
7. Moralizing.  We mistakenly assume that every biblical story has a moral.  But many stories were never intended to illustrate principles.  More often, they were written to show the progress of God’s redemptive history.
8. Personalizing.  In our self-centred way, we assume that the story has a meaning for us that it does not have for its readers generally.  It is understandable for a Christian solider going off to war to think that Psa 91:7 (‘A thousand may fall at your side, ten thousand at your right hand, but it will not come near you’) means that he will return from battle unscathed.  But it is mistaken.
9. Emulation.  We take every story as an example of what we ourselves are supposed to do.  “Be a Joseph, be a David, be a Daniel,” we say.  But theses stories are first and foremost about Joseph, David, and Daniel, and not about ourselves.  We should not rush to assume that God wants us to do exactly as these biblical characters did (they were, after all, fallible humans, just as we are).

Based (with both abridgement and addition) on Fee & Stuart, How to read the Bible for all its worth, p91f.