One- or two-day old bread is widely regarded as best for french toast-ish recipes as it can soak up liquid more effectively and is hardier when handling (doesn't break apart). That said, it's not a make-or-break factor for this tasty breakfast strata. If you only have fresh, soft bread, you can achieve a staler effect by cubing it and baking it in a 300°F oven on an ungreased sheet pan for up to 10 or so minutes, or until lightly dried.