What is the right course of action now?

Your choice to reduce speed is correct. According to German traffic rules, when a vehicle ahead shows intention to slow down or turn—especially if it signals a left turn—you must anticipate this and reduce your speed to maintain a safe distance. This allows you to react safely to any change, like the car waiting to turn or a cyclist nearby, ensuring smooth and safe traffic flow. Maintaining your speed or attempting to overtake in such a situation would be unsafe and generally unlawful, as it may endanger vulnerable road users and disrupt traffic.