Did a hacker send a message from my own email address, if so how?

I got one of the blackmailing emails that have been going round with my old password on it. I googled it and have seen many people received similar ones, so I am a little less concerened. The only thing that worries me, is that the email seemed to come from my own email address. It says my email address at the... show more I got one of the blackmailing emails that have been going round with my old password on it. I googled it and have seen many people received similar ones, so I am a little less concerened.

The only thing that worries me, is that the email seemed to come from my own email address. It says my email address at the top, and when I click the down arrow to see who it was sent to, it just says my old password!

It went straight to my junk and doesn't appear in my sent box.

I'm thinking, they can't possibly have access to my account if they don't even know my new password. But then how have they send this email either from my account or made it look like it is from my account? I would love if you could set my mind at ease.

Thanks
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