I got the response below from the WD support and apparently it seems as this was an error on their side. It cost me a sleepless night, but good to hear that it most likely not was a malicious attack of some sort.
"We sincerely apologize for the inconvenience this has caused you
I would like to inform you that this is an electronic email triggered when you attempt to reset your password from Mycloud.com using the option “I forgot password”. However, this email was triggered to you due to a technical error in our system. We have referred this concern to the concerned team to fix it at the earliest.
You may ignore the email at this time."