WordPress Login Dashboard not Working

Hi,

Following the multitude of brute WordPress attacks from the last few months, my hosting company recommended to password protect my wp-admin folder through .htaccess by following this article http://www.inmotionhosting.com/support/website/wordpress/prevent-unauthorized-wp-admin-wp-login-php-attempts

Everything seemed to work ok for the blog. However, today I set up a new development environment as I would like to upload my blog to the Twenty Thirteen theme but I would like to make sure everything works ok before switching over. I’ve created the new subdomain dev.augmentedtomorrow.com and installed WordPress there. The only problem now is that when I end up on the login screen for the subdomain I can’t log in. The username and password are correct, I don’t receive any error message but I can’t move forward. If I click on the “lost your password” and enter my email nothing happens.

I’ve chated to the guys from the hosting company and they said it is related to what wordpress does with the .htaccess file which is recursive so it applies to the whole domain. I have edited this when setting up the password for wp-admin. I don’t know if it has something to do with this but I would really appreciate all the help.

This is what I currently have in the .htaccess file

# BEGIN WPSuperCache
# END WPSuperCache

# BEGIN WordPress
<IfModule mod_rewrite.c>
RewriteEngine On
RewriteBase /
RewriteRule ^index\.php$ - [L]
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule . /index.php [L]
</IfModule>

# END WordPress
<FilesMatch "wp-login.php">
AuthType Basic
AuthName "Public"
AuthUserFile "/home/augmen6/.htpasswds/public_html/passwd"
require valid-user
</FilesMatch>