Exchange 2010 Authenitication failure

I have setup my Exchange Server to use MailHop using smart host. Enabled authentication without TLS using the same password and username as for DYNDNS and every time I send an email I get this ERROR:

in short summary:

Diagnostic-Code: smtp;550 You must authenticate to use MailHop Outbound
Remote-MTA: dns;mho-02-ewr.mailhop.org
X-Display-Name: Moses Aronov

Full Story

Received: from WIN-H718RE0N7EL.cbncore.local ([fe80::b839:e5d1:b0db:1e0f]) by
 WIN-H718RE0N7EL.cbncore.local ([fe80::b839:e5d1:b0db:1e0f%10]) with mapi;
 Sun, 1 Jan 2012 03:11:38 -0500
From: Moses Aronov <maronov@cbncore.com>
To: Moses Aronov <Mosesaro@me.com>
Subject: sdf
Thread-Topic: sdf
Thread-Index: AQHMyFz7GESe3QC0ZkqO+sVMAQg2tg==
Date: Sun, 1 Jan 2012 08:11:37 +0000
Message-ID: <9E8FBD4C-5800-4A07-9CB0-C573E1F57AA7@cbncore.com>
Accept-Language: en-US
Content-Language: en-US
X-MS-Has-Attach:
X-MS-TNEF-Correlator:
Content-Type: text/plain; charset="us-ascii"
Content-ID: <7b34d422-2868-4b5d-8a3f-7fa28321eae5>
Content-Transfer-Encoding: quoted-printable
MIME-Version: 1.0
Reporting-MTA: dns;WIN-H718RE0N7EL.cbncore.local
Received-From-MTA: dns;cbncore.com
Arrival-Date: Sun, 1 Jan 2012 08:11:38 +0000
Final-Recipient: rfc822;Mosesaro@me.com

Action: failed
Status: 5.0.0
Diagnostic-Code: smtp;550 You must authenticate to use MailHop Outbound
Remote-MTA: dns;mho-02-ewr.mailhop.org
X-Display-Name: Moses Aronov