Your session log should show something like:
[quote]
FOR CRAM-MD5
13:48:28.243: >> EHLO [192.168.0.3]<cr><lf>
13:48:28.246: << 250-mail.mydomain Hello [192.168.0.3]; ESMTPs are:<cr><lf>250-TIME<cr><lf>
13:48:28.249: << 250-AUTH CRAM-MD5 LOGIN<cr><lf>
13:48:28.251: << 250-AUTH=LOGIN<cr><lf>
13:48:28.253: << 250 HELP<cr><lf>
13:48:28.265: >> AUTH CRAM-MD5<cr><lf>
13:48:28.268: << 334 -munged challenge hash-<cr><lf>
13:48:28.282: >> -munged response hash-<cr><lf> << Base64 decode this line to get the username + morehash
13:48:28.282: << 235 Authentication successful.<cr><lf>
13:48:28.295: >> MAIL FROM:<user@mydomain><cr><lf>
FOR FOR AUTH=LOGIN
14:08:19.268: >> AUTH LOGIN<cr><lf>
14:08:19.275: << 334 VXNlcm5hbWU6<cr><lf>
14:08:19.369: >> -munged base64 username<cr><lf>
14:08:19.369: << 334 UGFzc3dvcmQ6<cr><lf>
14:08:20.461: >> munged base64 password<cr><lf>
14:08:20.461: << 235 Authentication successful.<cr><lf>
[/quote]
If you get no AUTH lines in your session log, then Thomas is right, and you are a (partially) open relay [:O]