What is the right course of action?

You answered correctly! The yellow diamond sign indicates you are on a priority road. The white sign below it shows the direction of the priority road, which turns left. The blue car is coming from a side street and must yield to you, since you are following the main road. So, you may drive through without waiting for the blue car. Remember: If you’re on the priority road, you have the right of way over vehicles from other streets.