Hmmm. I would ask the super pro veterans to chime in. He asked you for a hug. That is not pursuit but maybe a good time for some rejection on your end.
I don't see how rejecting him will help bring them closer.
Mirror him. Give him the same type of hug he gives you. No more, no less.
Just my opinion. You're trying to break the distance/pursuit cycle right. Now he pursuits her and she rejects. I mean c'mon he is cheating on her. A veteran once told me you have to reject them more then they reject you.
Little if you're in CT I will suggest you making the trip to Philly for EE in May. It will help you in ways you can't imagine. I put it off for 1 year. What a dumbazz I was
