Yes, you have the right idea of what hit means here. From M-W,
5 : to discover or meet especially by chance • prospectors hitting gold • hit a snowstorm while driving home • hit a run of bad luck
It is an idiomatic usage of the word hit. So in that sense, it is "proper": it makes sense. We can rephrase it with a more formal word, like encounter
Encountering all red lights can feel very unlucky.
but in a causal setting, hit would seem more fitting. Also, hitting the red lights seems more impactful than encountering, for example, if a writer wanted to convey that naunce.