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We present a variational approach based on the string picture to analyze the internal structure and dispersion of spin polarons with different symmetries in an antiferromagnet. We then use this to discuss the properties of underdoped cuprate superconductor within the `doped insulator' picture. The theory explains the remnant Fermi surface for the undoped compunds, as well as hole pockets, Fermi arcs, high energy pseudogap and the the mid-infrared band in doped materials. Destructive interference between the phases of a photohole near $\Gamma$ and the internal phases of the Zhang Rice singlet combined with our theory moreover explains the `waterfall' phenomenon., Comment: 19 pages, 16 figures