You can use allegro for things like key presses to move an ascii character across the console. But wouldn't it be better if you used allegro's built in window functions, and move from a console to a window and use Bitmaps?
You could certainly use Allegro to make an ASCII game. There's an alternative library called libtcod, which was specifically designed for ASCII games (well, roguelikes, but you can use it for anything). It's built on top of SDL with an optional OpenGL-based renderer. If you were to make an ASCII game with Allegro, you'd likely be implementing many of the same features yourself. For example, libtcod allows you to work with a virtual console buffer, a rather convenient way of handling an ASCII game. In Allegro, you'd either have to implement that on top of the bitmap API, or just work with the bitmap and text API directly. Personally, I'd go with libtcod.